GEOFF BENNETT: Welcome to the "News Hour."

The U.S. labor market made solid gains again last month, adding 151,000 more jobs just before the biggest federal layoffs began to hit.

AMNA NAWAZ: Unemployment crept up to 4.1 percent.

More than seven million Americans are unemployed.

Manufacturing had its best report in months, with 10,000 new jobs, which President Trump hailed at the White House.

DONALD TRUMP, President of the United States: We have not only stopped that manufacturing collapse, but we have begun to rapidly reverse it and get major gains.

We created 10,000 manufacturing jobs in February alone.

That hasn't happened in a long time.

And these aren't government jobs, which actually we cut.

These are private sector manufacturing jobs.

So we gained all of those jobs, 10,000 jobs, and we barely started yet.

GEOFF BENNETT: The economy actually last added more than 10,000 manufacturing jobs just a few months ago, back in November of 2024.

But there are other warning signs of what could be ahead not yet fully captured in this report.

AMNA NAWAZ: The outplacement firm Challenger, Gray reported more than 170,000 layoffs last month, more than 62,000 of those from the federal government.

That is the highest monthly total it's reported since 2020.

Julia Coronado is an economist at the University of Texas in Austin, who runs her own firm called MacroPolicy Perspectives.

Julia, welcome back to the "News Hour."

Thanks for joining us.

JULIA CORONADO, MacroPolicy Perspectives: Thank you.

It's my pleasure.

AMNA NAWAZ: So, 151,000 jobs added in February.

That is up from 143,000 in January.

How do you look at this report?

What do you see?

JULIA CORONADO: It was a solid report.

That's a very respectable job gain.

But there were under the hood some signs of cooling.

As you noted, the biggest federal layoffs that have been announced and actually followed through on really hit after the data was collected.

The data collected -- was collected for this report through mid-February.

Most of those layoffs have happened since then.

So we expect something like a 30,000 loss of jobs in the March report or maybe possibly even greater.

We also saw the unemployment rate creep up.

That's, again, still a very low -- 4.1 percent still a very low unemployment rate, so not in and of itself a warning sign.

But we saw underemployment also rise.

That is, we had almost half-a-million people take part-time jobs who wanted full-time jobs.

And that's something we track as kind of a leading indicator of cooling conditions.

So we're going to have to keep an eye on that.

AMNA NAWAZ: You saw President Trump there emphasizing the 10,000 jobs added in manufacturing in particular.

Those adds, though, they were dwarfed by jobs added in other sectors like education and health, where we saw some 73,000 jobs added.

We saw 19,000 jobs added in construction.

The president noted, though, that manufacturing has really been struggling.

So does he have a point in pulling that out?

Is that number of jobs added notable to you?

JULIA CORONADO: Not really; 10,000 is a relatively small number in the grand scheme of 150,000, which has been about the pace we have been seeing.

And it bounces around from month to month.

So I think you noted there was a greater than 10,000-job gain in November.

It's been bouncing around plus-minus.

The manufacturing sector in general has been pretty subdued.

After a surge of good spending during the pandemic, consumers have really shifted their spending to services.

And manufacturing has been flatlining.

And, most recently, some sentiment indicators suggest some warning signs.

Of course, manufacturing is going to be the epicenter of any trade wars.

And we hear anecdotes of a lot of uncertainty just in terms of making plans, making capital spending plans or hiring plans when you just don't know what the landscape looks like.

AMNA NAWAZ: Well, what about those concerns about the on-again and off-again tariffs from the Trump administration that they could be inflationary, they could even lead to a recession?

Do you share those concerns?

JULIA CORONADO: I think it's too early to say that the U.S. is heading to a recession.

Certainly, we have seen the U.S. just continue to be more resilient than people expect year after year, quarter after quarter.

And one of the things the U.S. has going in its favor is that it is the most diversified economy.

We have manufacturing, we have construction, we have professional services jobs, we have some of them, health care, as you noted, been a big contributor to job gains.

So we have a really robust diversified economy.

We do worry, though, not just about the federal job losses.

The federal sector is pretty small.

It's less than 2 percent of the work force.

But there's been a lot of cuts in contract payments to contractors with the federal government.

And that's probably twice as big as the actual loss of federal jobs directly.

So we're really watching that carefully.

Who contracts with the federal government?

Pretty much everybody, from farmers to hospitals to universities to primary schools.

And those are areas where job gains have been really strong over the last year or two.

So we're watching for signs that those sectors that have really driven the gains feel the squeeze of both the reduced payments, as well as just the uncertainty that hangs over the environment right now.

AMNA NAWAZ: Meanwhile, Julia, in the minute or so I have left, I know you were at a conference in New York today where the Fed chair, Jay Powell, spoke.

Did you get any sense of how the Fed is preparing to navigate all of this, the tariffs, the dramatic government cuts?

What's ahead?

JULIA CORONADO: So the message today was very clear that they're not in a rush to judgment.

The plan has been to lower interest rates further.

That's very complicate if they're facing a burst of inflation from tariffs.

And the message from Chair Powell was, with a still solid-labor market, we can afford to take our time and see how this combination of policies, trade up wars and tariffs, restricted immigration, but on the other side, fiscal policy, potential deregulation, how does that all fit together and affect the overall economy?

They can kind -- they're taking kind of a wait-and-see approach.

AMNA NAWAZ: All right, Julia Coronado, MacroPolicy Perspectives, thank you so much for your time and insights.

We appreciate it.

JULIA CORONADO: My pleasure.