Before the impact of tariffs, US non-farm payrolls in March grew more than expected, with the unemployment rate slightly rising to 4.2%.

The strong growth of non-farm payrolls in the United States in March exceeded expectations, with a slight increase in the unemployment rate, showing that the U.S. labor market remains robust ahead of the comprehensive tariff impact on the global economy. Data released by the U.S. Department of Labor on Friday showed that non-farm employment increased by 228,000 last month, with revisions to the previous two months' data. The labor force participation rate increased, leading to a slight increase in the unemployment rate to 4.2%, while wage growth remained stable. Following China's announcement of retaliatory tariffs on U.S. imports, U.S. stock futures and bond yields continued to decline. The market currently expects a 50% chance of a 25 basis point rate cut by the Federal Reserve next month, and has already priced in expectations of four rate cuts within the year. This latest employment report indicates that the U.S. job market still shows strong resilience before President Trump's announcement of a comprehensive tariff policy on Wednesday, which had a major impact on global financial markets and disrupted expectations for continued economic expansion in the U.S. Several Wall Street institutions have recently forecasted that the U.S. may face a recession risk this year, with the unemployment rate and inflation levels potentially rising simultaneously. This expectation will put the Federal Reserve in a more complex policy dilemma - policymakers both need to cushion economic shocks through rate cuts and maintain high borrowing costs to curb inflation. Federal Reserve Chairman Powell will speak later on Friday, with the market closely watching for the direction of his policies. By industry, job growth is led by healthcare, transportation, warehousing, and leisure and hospitality industries, with a rebound in retail employment partially reflecting the return of 10,000 striking workers at Kroger Co. (KR.US). Notably, as the Department of Government Efficiency (DOGE) pushes forward with federal layoffs, the number of federal government employees has seen its first consecutive decline since 2022. The U.S. Labor Statistics Bureau pointed out that employees on paid leave or receiving severance pay are still included in employment statistics. According to data from re-employment services company Challenger Gray & Christmas, in the past two months, federal agencies and contractors have planned to lay off over 280,000 people. Analysts warn that as layoffs spread to government contractors, universities, and non-profit organizations, the number of unemployment related to DOGE may exceed 500,000 by the end of this year. Economists will also closely monitor the impact of Trump's immigration policy on the labor market - border crossings have essentially stalled. The tariff impact has also spread to the private sector, with Stellantis (STLA.US) announcing temporary layoffs of approximately 900 workers in affected powertrain and stamping factories. The employment report includes two major systems: enterprise surveys (generating non-farm data) and household surveys (statistics on unemployment rates and participation rates). The employment indicator in the household survey rebounded this month after experiencing the largest decline in more than a year in February. The increase in the unemployment rate is due to two main factors. On one hand, more job seekers entering the labor market alleviates labor shortages for businesses; on the other hand, the number of permanently unemployed people is increasing. The labor force participation rate rose slightly to 62.5% in March, but the participation rate of the core labor force aged 25-54 has dropped to its lowest level in over a year.