US Labour Market Slows, Unemployment Rises to 4.4 Per Cent

NEW YORK, March 7, 2026 — The US economy shed jobs in February 2026 amid severe winter weather and a strike at Kaiser Permanente that disrupted more than 30,000 workers in Hawaii and California. Citing CNBC, on Saturday 7 March 2026, the US Bureau of Labour Statistics (BLS) reported that nonfarm payrolls fell by 92,000 in February 2026. The figure was well below expectations for a gain of 50,000 jobs.

February 2026 marked the third decline in payrolls in five months, following a sharp revision showing December 2025 payrolls down by 17,000.

The unemployment rate rose to 4.4 per cent, as job losses appeared across several key sectors of the economy.

However, the broader measure of unemployment — which includes people who are unemployed as well as those working part-time for economic reasons — declined to 7.9 per cent.

One of the sectors most affected by the job losses was health care. Over the past year, the sector had been a major driver of payroll growth in the US.

In February 2026, the health-care sector shed 28,000 jobs. The decline was largely due to a strike at Kaiser Permanente involving more than 30,000 workers in Hawaii and California.

Although the strike has ended, the episode occurred during the survey week, and therefore affected the payroll total in the report.

Average hourly earnings rose 0.4 per cent in February 2026. On an annual basis, wage growth rose to 3.8 per cent compared with a year earlier. Both figures were 0.1 percentage point higher than previously forecast.

Mary Daly, president of the Federal Reserve Bank of San Francisco, said the data show that the prospect of a stabilising labour market may be too optimistic.

“I think the hope that the labour market would stabilise may be too optimistic,” Daly told CNBC. She also noted that inflation remains above target and that oil prices are rising.

“We are facing inflation above target and higher oil prices. How long this will last we do not know, but both of our goals are at risk and we must keep monitoring both,” Daly said.

Beyond health care, the information services sector also posted job losses, down 11,000, continuing a 12-month trend of losses averaging around 5,000 per month.

The manufacturing sector also recorded a decline of 12,000 jobs in February, even as the US government implements tariffs aimed at bringing manufacturing activity back home from overseas.