Tech Job Market Plummets: 92,000 Jobs Lost in February as Information Sector Continues Decline

The US labor market just served up a cold dose of reality… and the tech sector is catching the worst of it.

New data from the US Bureau of Labor Statistics (BLS) shows the economy lost 92,000 jobs in February, while the unemployment rate ticked up to 4.4%. The figure stunned economists who had expected modest job growth. Instead, the report revealed a labor market that is losing momentum across several industries, including technology.

According to the BLS employment report, the labor market weakened compared with January, when employers added 126,000 jobs.

“Total nonfarm payroll employment edged down by 92,000 in February, and the unemployment rate changed little at 4.4%,” BLS wrote in their report. The BLS also said job growth in key sectors slowed or reversed. Healthcare employment alone fell by 28,000 jobs, largely due to strike activity.

Meanwhile, employment in the information sector, which includes publishing industries, telecommunications, computing infrastructure providers, and web search portals, continued its downward trend in February, shedding another 11,000 positions. The BLS report noted that the industry “had lost an average of 5,000 jobs per month over the prior 12 months.”

Federal government employment also dropped by 10,000 positions, continuing a broader decline that has been underway since 2024.

Wages still climb despite weak hiring

Despite the job losses, wages continued to grow modestly.

Average hourly earnings for private-sector workers rose 15 cents in February to $37.32, marking a 0.4% increase from the previous month and a 3.8% increase over the past year, according to the BLS report. The average workweek remained steady at 34.3 hours.

White House downplays the damage

Kevin Hassett, director of the White House’s National Economic Council, acknowledged the numbers came as “something of a surprise” but downplayed their significance in an interview with CNBC.

“If you take the average over a few months, we had a surprisingly positive one last month and a surprisingly negative one this one,” Hassett told CNBC. “But on average, it’s about what we expect to be seeing because immigration has gone down by so much.”

Hassett also expressed optimism about the future, noting: “There will be so much activity that everybody is going to be able to find a job that wants one.”

The BLS also revised down December and January numbers, making the picture even bleaker. December’s previously reported gain of 48,000 jobs was revised down to a loss of 17,000. January’s numbers were trimmed by 4,000 to 126,000. Combined, that’s 69,000 fewer jobs than previously reported.

The Fed’s uncomfortable position

The jobs report drops into an already tense environment for the Federal Reserve, which meets later this month to decide on interest rates. Under normal circumstances, a weakening labor market would prompt rate cuts to stimulate hiring. But oil prices, elevated by ongoing conflict in the Middle East, are raising fresh inflation concerns, leaving the central bank in a bind.

Fed Chair Jay Powell has signaled that policymakers are not in a rush to cut rates further in the near term, following three reductions last year. Friday’s data is unlikely to accelerate that timeline, but another report like this one could change the calculus.

For job seekers in the tech sector, especially recent graduates, the downturn could make it tougher to enter the industry.

The February BLS data doesn’t yet include layoffs announced after the reporting period ended, meaning March’s figures could add more pressure. And with no clear catalyst for a hiring rebound in sight, the sector may be in for more of what it’s already been enduring.

Image: Freepik