March Jobs Report Shocks With 228,000 New Hires — But Tariffs Could Ruin the Party

The U.S. labor market delivered a stronger-than-expected performance in March, with employers adding 228,000 jobs—well above economists’ forecasts. The surprise gain highlights continued resilience in hiring, even as trade tensions threaten to slow broader economic momentum.

According to the Labor Department, the unemployment rate ticked up slightly to 4.2% from 4.1% in February, while February's job gains were revised downward to 117,000. Despite the revision, March’s numbers reflect solid demand for workers across industries.

But the positive data came during a wave of market turbulence sparked by a new round of tariffs from President Joe Biden’s administration. The White House’s sweeping import duties—intended to protect American industries—have drawn a sharp response from China, which announced a 34% tariff on U.S. goods, starting April 10.

That tit-for-tat trade clash has spooked investors:

• S&P 500 futures dropped by 2.5%

• 10-year U.S. Treasury yields rose to 3.92%

• 2-year yields climbed to 3.54%

• The dollar index gained 0.19%, while the euro slipped 0.26%

While the headline jobs figure is reassuring, certain sectors showed signs of strain. Manufacturing added just 1,000 jobs last month, and economists caution that global supply chain risks could hurt output further.

Brian Jacobsen, Chief Economist at Annex Wealth Management, said the employment report was solid overall. “Wages and total hours worked are up—that’s a good sign,” he noted. “But with tariffs coming into play, the Fed may hold off on any major decisions until it sees how businesses react.”

Lindsay Rosner, Head of Multi-Sector Fixed Income at Goldman Sachs Asset Management, said the market’s attention has shifted. “The jobs number is encouraging, but the bigger concern right now is trade,” she said. “Tariffs are quickly becoming the main driver of market sentiment.”

March’s job growth is encouraging, but rising trade barriers and business uncertainty may slow things down. Economists and markets will be watching closely to see how these competing forces shape the economic outlook over the coming weeks.

Also Read: Jobs Report, Fed Chair Powell’s Speech, and Trade Policy Impact