The U.S. labor market remained steady in February, with new unemployment claims dropping by 21,000 to 221,000, a larger decline than expected. However, concerns are rising due to significant federal job cuts and trade policy shifts. Layoffs surged to 172,017 last month, with over 63,000 attributed to government downsizing under the Department of Government Efficiency (DOGE). Meanwhile, the trade deficit hit a record $131.4 billion as companies increased imports ahead of new tariffs. While the Federal Reserve has held interest rates steady, ongoing trade disputes and government spending reductions may impact economic stability.
See "US labor market steady, tariffs and federal government layoffs a risk to outlook", Lucia Mutikani, Reuters, March 6, 2025