March 2025 Market Trends Report
The 2025 job market continues its trend of stable job gains with 151,000 jobs added in February, as reported by the Bureau of Labor Statistics’ Employment Situation Summary.
The full impact of the Department of Government Efficiency (DOGE) layoffs is yet to hit the report, with the government sector losing 10,000 jobs last month. Outplacement firm Challenger, Gray & Christmas reported that government layoffs exceed 62,000 jobs this year, so a greater impact to BLS reporting is likely yet to come.
Most private-sector industries saw job gains, with healthcare adding the lion’s share of jobs (52,000), followed by financial activities (21,000) and transportation and warehousing (18,000).
Month over month, the unemployment rate increased slightly to 4.1%, and labor force participation dropped to 62.4%.
Although the past three months of job gains have been stable and positive (averaging 169,000 jobs each month), the impact of new policies and regulatory changes on the labor market are expected to take clearer shape as we approach Q2.
Jobs Market Overview: February 2025
4.1%
Overall unemployment rate
Unemployment increased from 4% last month, sinking back to its 4.1% December rate.
151k
Jobs added
The February labor market continues a positive and stable three-month job trend.
62.%4
Labor force participation rate
Labor force participation dropped to its lowest since January 2023.
Industry Employment Trends
OVERALL ECONOMY
+151k
Monthly job change
(+1,947,000 year over year)
| Industry | Monthly Job Change | YoY Difference |
| Manufacturing | +10k | -88k |
| Automotive | +8.9k | -12.1k |
| Warehousing & Storage | -3.1k | -1.6k |
| Architectural & Engineering | +3.2k | +45.6k |
| Construction | +19k | +174k |
Source: Bureau of Labor Statistics' Economic News Release
Sector-by-Sector News: February 2025
Warehousing & Storage Report
January Logistics Managers' Index (LMI): 62.8*
*An LMI reading above 50 suggests logistics metrics are expanding.
Warehousing & Storage Monthly Employment Change: -3,100 jobs
For the second consecutive month, the Logistics Manager’s Index (LMI) Report expanded at the fastest rate since June 2022 thanks to increasing inventory levels. A surplus of inventory is driving increasing inventory costs and warehousing prices.
“Both of these are reading in at their fastest rate of expansion in several years,” the February 2025 LMI Report stated.
“Supply chains strain to shoulder both the volume and velocity of inventory that poured across U.S. borders in January and early February as firms attempted to avoid costs associated with potential tariffs.”
Continuing from January, warehousing employers are navigating the uncertainties of tariffs and a recent drop in consumer sentiment, yet growth has been consistent.
To hedge against the potential impact of tariffs, warehouses increased inventory levels, leading to a drop in warehousing capacity and a reciprocal surge in inventory and warehousing prices.
The market looks resilient, yet the warehousing and storage industry shed another 3,100 jobs in February.
At the same time, respondents to ISM’s survey are still optimistic, predicting continued expansion across inventory levels and cost metrics throughout 2025.
Growth is increasing at an increasing rate for:
- Inventory levels
- Inventory costs
- Warehousing utilization
- Warehousing prices
- Transportation capacity
Growth is increasing at a decreasing rate for:
- Warehousing capacity
- Warehousing utilization
- Transportation utilization
- Transportation prices
Construction Jobs Report
Construction Monthly Employment Change: +19,000 jobs
Slowing job growth was a hallmark of the 2024 labor market, a trend that reversed in February with 19,000 jobs added in construction (compared to only 2,000 jobs added in January).
Contractors are optimistic, and widening job availability will hopefully curb a continually rising unemployment rate. Since its seven-month low of 3.2% in August 2024, it has spiked to 7.2% in February (up from 6.5% in January).
Construction employment increased across all of its subcategories, including:
- Specialty trade: 14,600
- Heavy and civil engineering, 2,500
- Nonresidential building: 1,700
Holistically, the industry will likely see continued growth throughout the year thanks to projected increases in construction and government spending. The scarcity of skilled construction talent, however, could impact construction project timelines and costs.
Manufacturing Jobs Report
January Manufacturing Purchasing Managers' Index (PMI): 50.3%*
*A PMI reading above 50% suggests economic activity is expanding.
Manufacturing Monthly Employment Change: +10,000 jobs
February marks the second month of manufacturing PMI growth after 26 months of contraction, according to the Institute for Supply Management (ISM). However, it registered at a slower rate of expansion from last month (down from 50.9% in January).
Stable production drove marginal growth, and employers added 10,000 manufacturing jobs since January. Although, a year-over-year comparison is less favorable with 88,000 jobs lost since February 2024.
Despite month-over-month employment growth, destaffing plans continued in February with the Employment Index moving back into contraction (down 2.7% from January’s reading of 50.3%). This continues a trend of contraction since May 2022 as the index has downshifted 27 of the last 34 months.
According to Chair of the ISM Timothy Fiore, “panelists are continuing to release employees as the business environment becomes more unclear.”
Manufacturing industries that reported employment growth in February (listed in order) include:
- Plastics & Rubber Products
- Wood Products
- Paper Products
- Miscellaneous Manufacturing
- Fabricated Metal Products
- Transportation Equipment
Manufacturing industries that reported a decrease in employment include:
- Textile Mills
- Furniture & Related Products
- Petroleum & Coal Products
- Primary Metals
- Machinery
- Chemical Products
- Food, Beverage & Tobacco Products
- Electrical Equipment, Appliances & Components
- Computer & Electronic Products