Private Payrolls Jump 63K in February
US private companies added 63,000 jobs in February — the largest increase in seven months. January's figure was sharply revised down to just 11,000 additions, suggesting more volatility in labor trends than initially reported.
The February job gains were heavily concentrated in just a few industries. Education and health services led the way, adding 58,000 positions, followed by the construction sector with an increase of 19,000 jobs. Conversely, several sectors shed jobs last month. The professional and business services sector saw the largest decline, losing 30,000 jobs. Manufacturing also continued its downward trend with a loss of 5,000 positions. The significant downward revision for January's job growth, from 22,000 to just 11,000, aligns with a broader cooling trend in the U.S. labor market observed throughout 2025. The unemployment rate in January stood at 4.3%. Pay dynamics are also shifting for American workers. While wage growth for those who stay in their jobs remained steady at 4.5% year-over-year, the financial incentive for changing jobs has diminished. The pay premium for job-switchers hit a record low in February, according to ADP's Chief Economist, Nela Richardson. This mixed labor market data comes as the Federal Reserve holds its benchmark interest rate steady. After a series of rate cuts that began in September 2024, the Fed paused in January 2026, maintaining the rate in a range of 3.5% to 3.75%. Market analysts widely expect the central bank to maintain this pause at their upcoming March meeting, closely watching both inflation and employment data for future guidance. The stability of the labor market, alongside inflation concerns, is a key factor in the Fed's policy decisions.
