The U.S. Bureau of Labor Statistics announced that the manufacturing industry lost 12,000 jobs in February.
That’s a 500% drop compared to the data from the same period last year, which showed a loss of 2,000 jobs, according to the Federal Reserve Economic Data. It’s also a huge loss after the industry gained 5,000 jobs in January.
“This February jobs report was far weaker than I had hoped, particularly after a slight bump up for manufacturing in January,” Scott Paul, Alliance for American Manufacturing’s president, said in a statement. “There are many factors swirling around — [artificial intelligence], bad weather, tariff volatility, and much more. With a potential energy shock on the horizon, there may be even worse news to come.”
The transportation equipment and plastics and rubber products sectors lost the most jobs last month at approximately 4,000 and 4,200, respectively, according to the report. These were followed by wood products with about 2,400, and beverage, tobacco, and leather and allied products with 2,100.
The textile mills, primary metal and food sectors each lost about 1,000 or more employees.
In terms of jobs gained, the fabricated metal sector topped the list in February, adding an estimated 2,100 employees. This was followed by the chemical, machinery and electrical equipment, appliance and component sectors, which each added 1,000 or more jobs last month.
Meanwhile, manufacturing unemployment increased by approximately 15.6% with 527,000 workers in February, compared to 456,000 year over year.
Panelists surveyed for the Institute for Supply Management’s latest Purchasing Managers’ Index report released on Monday showed that their hiring versus headcount reduction improved to a ratio of 1-to-1.4. However, executives also voiced their ongoing concerns with tariffs as the reason for not filling open roles, Susan Spence, chair of ISM’s Manufacturing Business Survey Committee, said on a call with reporters Monday.
The Supreme Court’s ruling as well as the recent U.S.-Israeli strikes against Iran could create more uncertainty, Spence said.
S&P Global’s U.S. manufacturing PMI reported “muted” employment growth in February. S&P also said in its report that U.S. manufacturers were restraining from hiring, leading employment to increase only “fractionally.” Furthermore, a “degree of excess capacity” lead to limiting hiring as backlogs work declined.
“I hope the White House will continue to address unfair trade practices to open markets abroad and defend our workers and businesses here at home,” Paul said. “I also hope the Federal Reserve doesn't raise interest rates, which could drive further job losses in factories.”
