February 2026 jobs report preview

The 2025 labor market has been generously described as “unstable,” with nearly no jobs progress and a slew of headwinds anticipated to conspire towards it. In 2026, although, the buzzword appears to be “stable,” although circumstances appear to be largely the identical.

The image continues to be of a low-hire, low-fire climate, the place firms are each reticent to put off staff as demand continues to be sturdy, but in addition are leery of including employees amid uncertainty over tariffs, inflation and geopolitics.

However, characterizations coming from Federal Reserve officials and market economists have grown no less than a bit extra optimistic — stressing the steadiness, if not the robustness, of the labor market.

The distinction between this 12 months and final? Expectations.

A prevailing perception is that with the clampdown on immigration and different elements holding again labor pool progress, a subdued hiring fee is ok — no less than for now — and the present tempo of job progress is enough and even anticipated.

“We’ve actually been getting signs of the U.S. labor market showing some stability,” Claudia Sahm, chief economist at New Century Advisors, mentioned in a latest CNBC interview. Sahm, creator of the oft-cited “Sahm Rule” that makes use of modifications within the unemployment fee to forecast recessions, added that there is a have to “be very watchful” as “the fact that the hiring rate is so low does make us vulnerable.”

“We’ve actually got some good news as we came into the year in the labor market. But we do need to see the hiring rate pick up,” she added. “That has been kind of a mystery, how low hiring is given the fact that the U.S. economy is expanding.”

More clues on the place the employment image is headed will come Friday when the Bureau of Labor Statistics releases its month-to-month nonfarm payrolls report for February at 8:30 a.m. ET.

Economists surveyed by Dow Jones anticipate payroll progress of fifty,000, following January’s surprisingly high 130,000. The unemployment fee is predicted to carry at 4.3%, one other signal of that, sure, secure labor market that actually is not going gangbusters however is simply sturdy sufficient to maintain that jobless stage regular.

However, the so-called stability might not be all it seems.

Most of the payroll beneficial properties in 2025 got here from health-care-related industries. Without the sector, even the meager 15,000 month-to-month common beneficial properties final 12 months would have evaporated, and this 12 months’s surroundings seems largely the identical to these on the bottom.

“One of the things that is very interesting-slash-potentially problematic is that we have almost all the growth happening in this health care and social [assistance]” sectors, mentioned Laura Ullrich, director of financial analysis at Indeed. “I don’t really see it as balanced or stable if you’re seeing so much growth in just one subsector.”‘

For January, the 2 sectors accounted for virtually all the gains, with well being care contributing 82,000 jobs and social help including 42,000. By distinction, building misplaced 88,000 in 2025, regardless of President Donald Trump’s tariffs aimed toward stimulating the sector.

Technology-related fields even have been underneath stress with the accelerated adoption of synthetic intelligence. Block co-founder and CEO Jack Dorsey rattled the labor market final week when saying the agency can be slashing about 40% of its payroll in response to AI.

For February particularly, the BLS report may very well be pressured by a since-resolved strike at Kaiser Permanente, a improvement that would hit the health-care numbers because it impacted 31,000 employees in California and Hawaii. Though the deadlock ended Feb. 23, the strike occurred through the survey week the BLS makes use of to compute the report.

Bank of America is forecasting a below-consensus achieve of 35,000 in payrolls due to the strike, although the agency mentioned the unemployment fee might not be impacted.