Sentiment is Just a Feeling: February 2025 Jobs Report

Last week BLS dropped its most recent employment situation. Let’s start with the data.

February’s topline report was uneventful: 151,000 new jobs and 4.1% unemployment. However, there was interesting nuance behind the headlines. For example, federal government employment declined last month. And although health care comprised more than a third of all job gains, sectors like finance, warehousing and transportation all saw upticks. Some of these improvements were consistent with January’s ISM-PMI survey, which also showed meaningful improvements in the manufacturing sector.

Unfortunately, hard labor data usually matters much less to local job markets than something much less quantifiable: SENTIMENT. And sentiment isn’t great right now. The looming specter of “will-he-won’t-he tariffs,” a tanking stock market, and the much-discussed price of eggs are all taking a toll. ?In February, consumers anticipated inflation would worsen over the next 12 months, projecting an increase of a tenth of a percentage point to 3.1%, according to the New York Federal Reserve's survey of consumers. Meanwhile, U.S. consumer sentiment dropped more than expected in February to a 15-month low.

It's not surprising that this negativity is spilling into the job market for both employers and employees. For employees, things are even more challenge: after years of increasing wages and remote options, both are going away. Among 1,900 U.S. companies polled by WTW, nearly half said they downsized their budgets for salary increases in the last year. (Median raise budgets were 4.5% in 2023, 4.1% in 2024, and 3.9% in 2025). Meanwhile, return-to-work mandates are ubiquitous.

For the past 12 years, Gallup has been conducting a regular survey regarding employee “job satisfaction” and “intent to leave.” At the start of 2025, “job satisfaction” hit an all-time low and “intent to leave” tied its all-time high.

So, what is an employer or employee to do?

You can start by recognizing that sentiment is just a feeling. While it plays a powerful role in the national market, it doesn’t dictate the local or individual circumstances you may be facing. Your industry, location, history, compensation, management, requirements and hiring process will all impact how you experience the labor market. Employers who hire based on national sentiment will almost always make suboptimal decisions.

As the market is shifting, we recommend employers consult someone with hands-on experience in your relevant market. Here at the TalentZ?k family of companies (including Simply Biotech and Defense Search), we speak with thousands of employers and candidates each month. That experience allows us to advise our clients on policies and processes to ensure that they can find the talent needed regardless of the market.

If you’d like to learn more, please contact us. And if you enjoyed this article, please subscribe to our Newsletter, The Gatekeeper, for further insights regarding the employment market and the staffing and recruiting industry.

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