February jobs report: Speed bump start to 2026

The latest jobs numbers are out from the U.S. Bureau of Labor Statistics. What do they mean for job seekers, employers and investors? Here’s a quick take from Glassdoor’s Chief Economist Daniel Zhao.

The 2026 job market hit a speed bump on its rollercoaster start to the year with job gains rising in January followed by a sudden drop in February. The optimism around the January surge amid solid demand lasted only several weeks, with the latest data pointing to a more stagnant jobs growth picture. The last two months have already seen severe winter weather, government shutdowns, and strikes, which all muddy the job market picture, but overall point to 2026 repeating 2025’s theme of uncertainty.

Key stats

First health care job loss since April 2025

Health care lost 28,000 jobs for the first month of net job losses in the industry since April 2025. This is a bit of a mirage, though, as 31,000 Kaiser Permanente workers were on strike during the establishment survey reference period. Those workers will return to payrolls in the March report, meaning that February’s job gains in health care would have been +3,000 without the effects of the strike.

This, however, would still be slow growth in health care, the most consistent source of jobs growth over the last few years. Without health care’s boost, there’s nothing to outweigh private payroll losses in other sectors. Private payroll job losses totaled 86,000 in February, and even excluding the 31,000 workers on strike would only be enough to bring payroll job losses up to -55,000.

Population control updates

At the start of each year, the Bureau of Labor Statistics updates the population controls for the household survey, adjusting for updated population estimates. These changes are ordinarily fairly unremarkable, accounting for minor deviations between population projections at the start of the previous year and actual growth. This year, however, the population control updates happened against a backdrop of significantly reduced net migration. Additionally, the population control updates were delayed by the government shutdown but are now available as of today’s report and are applied retroactively to January 2026 data.

All that being said, the impact from the population control updates was small to mixed for the household survey. Downward revisions to population also reduced estimates of the size of the labor force and the number of workers employed, while boosting the number of Americans not in the labor force. But in total, that resulted in a negligible change to the number of people employed. 

The net result was no change to the unemployment rate as a result of the population control updates, but the labor force participation rate (-0.4 percentage points) and employment-population ratio (-0.5 percentage points) were both estimated to be much lower due to the population control updates.

More insights

Payroll employment shrank by 92,000 in February and December 2025 was revised downward to a job loss. The chart shows visually that the job market has flip-flopped every month between job gains and losses since May 2025. The end result is that payrolls have barely changed at all since May 2025, with a 19,000 total job loss.

A large reason behind February's drop is the Kaiser Permanente strike which temporarily subtracted 31,000 workers from payrolls. These workers will return to payrolls in March, but even excluding the striking workers, health care grew by just 3,000 jobs, a worrying deceleration for the industry that has steadily powered jobs growth for the last few years.

The wild swings in jobs growth, recent government shutdowns and severe winter weather make it hard to ascertain which trends to believe. Solid economic data and the strong January jobs report had fostered optimism that jobs growth was firming, but looking at the long view, it seems more like jobs growth has been flattening since May 2025, despite the wild swings.

Average hourly earnings grew 3.8% year-over-year in February, up from 3.7% in January. Recent wage growth is a little weaker with the 3-month annualized change at 3.5% as of February.

The unemployment rate ticked up to 4.4% in February from 4.3% in January. Unemployment is still holding fairly steady despite fears of an increase after the fall 2025 government shutdown.

Despite population control updates reducing estimates of the employment-population ratio and labor force participation rate, the picture for prime-age (25–54) workers is more optimistic. Prime-age labor force participation and employment-population ratio both dropped by just 0.1 percentage point in February but remain near recent peaks.

Black unemployment rose to 7.7% in February from 7.3% in January. Similarly, Asian unemployment rose to 4.8% from 4.2% and Hispanic or Latino unemployment rose to 5.2% from 4.9%. These rates are estimated based on small sample sizes and may vary substantially from month-to-month.

With December job gains revised down substantially, the updated year-end count for 2025 puts jobs growth at 116,000, an unusually slow mark. Typically jobs growth that slow is only seen during recessions or in the immediate aftermath of them.