US Unemployment Rate Could Hit 4% for First Time in Over 2 Years, Signaling Cooling Labor Market

The US unemployment rate has been below 4% for over 2 years, a remarkably low level historically. It could rise to 4% in the March jobs report, ending that streak.

February's jobs report showed a rise in unemployment to 3.9% despite a higher-than-expected 275,000 jobs added. The unemployment rate and payroll numbers come from different surveys.

Slowing wage growth and fewer people quitting jobs could ease inflation pressures. Layoffs also haven't spiked much recently.

The unemployment rate could go up for various reasons - more people looking for work, fewer people employed, or a combination. It doesn't necessarily mean the economy is weakening.

But other signs like slower job gains and more layoffs indicate the labor market is cooling even though unemployment hasn't hit 4% yet as expected. The Fed's interest rate hikes to fight inflation are having an impact.