The March jobs report is anticipated to show that the U.S. labor market remained relatively stable prior to the onset of the Iran war, according to surveys conducted by the Bureau of Labor Statistics, which were completed by March 12 [1]. At that time, the full impact of the conflict had not yet affected the job market, but experts note that the war has already shifted the economic outlook in the weeks since [1]. Gasoline prices have surged to over $4 a gallon, a level that, if sustained, could reduce U.S. consumers' annual discretionary income by hundreds of dollars [1].
The Atlanta Federal Reserve lowered its real-time gross domestic product estimate to 1.9% on Wednesday, down from more than 3% before the start of the war, reflecting the economic uncertainty and energy shock [1]. Stock markets have declined and oil prices have spiked in the wake of rising uncertainty, which Friday’s jobs report will partially capture [1]. Economists from Pantheon Macroeconomics highlighted that consumers were already facing challenges from a soft labor market, weak real income growth, and a depressed personal saving rate, with the Michigan consumer survey’s major purchases index indicating a continued slowdown in spending on goods. The surge in gas prices and declining confidence since the war began are expected to exacerbate these headwinds [1].
The labor market is described as being in a "no-hire, no fire" environment, with subdued layoffs and new placements [1]. The Bureau of Labor Statistics reported that the hiring rate in February fell to 3.1% of the U.S. workforce, a level last seen in April 2020 during the Covid-19 pandemic, and only slightly above the 2.8% rate recorded during the 2008-09 Great Recession. Job openings also declined in February but appear to be stabilizing, while the rate of layoffs remains at an all-time low [1].
Public sentiment regarding the economy and President Donald Trump's handling of it continues to deteriorate. A CNN poll released Wednesday found only 31% of respondents approve of Trump's management of U.S. economic performance, and just 27% approve of his handling of inflation, down from 44% a year ago. His overall approval rating has stabilized at about 35% [1]. There is ongoing debate about how many jobs need to be added monthly to maintain the current unemployment rate of 4.4%, or roughly 7.6 million people, given reduced immigration and increasing retirements among baby boomers [1].
CONCLUSION
The March jobs report is expected to reflect a stable labor market before the Iran conflict, but subsequent economic shifts—such as surging gas prices and declining consumer confidence—are already impacting growth and sentiment. With GDP estimates lowered and hiring rates at historic lows, the market faces significant headwinds. Public approval of economic management is also waning, underscoring the heightened uncertainty and negative outlook.