U.S. employers cut 92,000 jobs in February, the Labor Department reported, marking the first monthly decline since 2020. The unemployment rate rose to 4.4 percent, with losses across nearly all major sectors including healthcare, which was hit by a California nurses strike. Economists had expected job growth to accelerate this year after an anemic 2023.

The report casts doubt on the labor market's strength, with January and December figures also revised downward. Health care employment fell by 19,000 jobs, dragged down by a California nurses strike that kept 31,000 people out of work. While wage growth remained solid at 3.8 percent annually, the participation rate for prime-age workers dipped slightly to 83.9 percent.

White House officials downplayed the data, with National Economic Council Director Kevin Hassett calling the economy "really strong" despite the contraction. The Trump administration faces political pressure as gas prices surge to $3.32 per gallon amid Middle East tensions. Democrats seized on the report, warning that Trump's economic policies could push the economy toward recession as they make the economy a central campaign issue ahead of midterm elections.