US hiring surged in March, defying recession fears
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(NEW YORK) — U.S. hiring surged in March, blowing past economists’ expectations and defying concern on Wall Street about a possible economic recession, government data on Friday showed.
The fresh data offered news of an upsurge in employer activity as stocks suffered a second day of selloffs over sweeping new tariffs announced by President Donald Trump earlier this week.
The U.S. added 228,000 jobs in March, according to data from the U.S. Bureau of Labor Statistics. That figure amounted to robust hiring and marked a major increase from 151,000 jobs added in the previous month.
The unemployment rate ticked up slightly to 4.2%, but it remains historically low.
The uptick in hiring last month came despite staff cuts imposed by the federal government amid cost-cutting efforts undertaken by the Department of Government Efficiency.
Federal government employment declined by 4,000 jobs in March, following a dropoff of 11,000 jobs the previous month.
The job gains came primarily in health care, transportation and warehousing.
Average hourly wages climbed 3.8% over the year ending in March, indicating that pay increases outpaced the inflation rate over that period.
Despite escalating trade tensions and market turbulence since Trump took office in January, the economy remains in solid shape by several key measures.
The unemployment rate stands at a historically low level. Meanwhile, inflation sits well below a peak attained in 2022, though price increases register nearly a percentage point higher than the Fed’s goal of 2%.
“The economy is strong,” Fed Chair Jerome Powell said at a press conference in Washington, D.C., last month.
Tariffs announced earlier this week, however, threaten to derail hiring and worsen inflation, multiple analysts previously told ABC News.
The far-reaching levies increase the likelihood of a recession by driving up prices, sapping consumer spending, slowing business activity and risking layoffs, they said.
The White House plans to slap a 10% tax on all imported products and place additional duties on items from some of the largest U.S. trading partners, including China and the European Union.
“These policies, if sustained, would likely push the U.S. and global economy into recession this year,” J.P. Morgan said in a note to clients after the tariff announcement.
“Recession risks will likely rise,” Deutsche Bank added.
U.S. stocks plunged on Thursday in the first trading session after Trump unveiled the new tariffs.
The Dow Jones Industrial Average plummeted 1,679 points, or nearly 4%, while the tech-heavy Nasdaq declined almost 6%.
The S&P 500 tumbled 4.8%, marking its worst trading day since 2020.
(NEW YORK) — An Elon Musk ally hired to overhaul the U.S. Department of Treasury has a lengthy record of undertaking hardline reforms in the private sector that demoralized staff and made them fear for their jobs, according to interviews with several former employees at his tech firm.
Tom Krause, the CEO of Silicon Valley-based Cloud Software Group, oversaw layoffs at his company in each of the last three years while instituting a return-to-office mandate, rigid performance ratings, and a request that weekly updates be sent from workers directly to Krause, the former employees told ABC News — echoing the sort of reforms that Musk’s new Department of Government Efficiency has begun undertaking within government agencies.
One former Cloud Software Group employee said she hid her pregnancy for fear it could make her a target of layoffs. An ex-manager said they dreaded filing performance reviews of subordinates, knowing some workers may fall victim to the next cycle of cuts. Another former employee said they avoided expressing unease in company emails or in the messaging app Slack out of concern that it could jeopardize their job.
“They’re taking business practices popular in boardrooms and on golf clubs, and they’re taking them into government,” Kathleen Roan, a former senior content designer at Cloud Software Group who retired in 2024, told ABC News.
Krause in recent days has vaulted into a key position at the Treasury Department, overseeing its $5 trillion payment system, which sends funds to tens of millions of Americans for programs like Medicare and Social Security, the agency’s website says.
In a press release, the agency said Krause brings decades of experience “managing balance sheets” to the agency’s effort to “maximize payment integrity.”
Neither Krause nor Cloud Software Group responded to a request for comment from ABC News.
A ‘hatchet man’
Several former employees ABC spoke with praised Krause as a savvy business leader, and one said they enjoyed their tenure at the company. But most of them requested that they not be identified due to concerns about reprisals.
“There was a whittling away of the things that made you feel like you were a valued employee and then finally ‘Oh, now we’re going to start eliminating jobs,'” Roan said of her time at the company under Krause. “They saw people as expendable.”
Cloud Software Group company was established in 2022 through the acquisition of enterprise software firm Citrix in a private equity-backed $16.5 billion deal, followed by a merger with TIBCO Software.
Krause, who had previously served as president of software at Palo Alto-based Broadcom, was named CEO of the new firm.
Within months, in January 2023, the company cut 15% of its workforce.
“The feeling was that he was there to cut expenses down and be a hatchet man, similar to what’s happening now in the government,” a former human resources employee said. “Everyone was on edge.”
Some of the cost-cutting measures at Cloud Software Group under Krause were first reported by The American Prospect.
Within months of Krause’s arrival, the company also requested that employees return to the office, multiple former employees said.
At the same time, the company closed some offices in an effort to reduce overhead costs, multiple former employees told ABC News. The closures left some workers without an office nearby, making them exempt from the return-to-office requirement, a former employee said.
On Inauguration Day, Trump signed an executive order calling on federal agency heads to mandate in-office work. Musk backed that policy in an op-ed he co-authored in the Wall Street Journal, predicting that mandatory return to work “would result in a wave of voluntary terminations that we welcome.”
‘A much higher level of business discipline’
Employees at Cloud Software Group lost some perks, too.
David Morgan, a former client support provider at Cloud Software Group, said the firm ended his quarterly bonuses, which amounted to $16,000 each year. Workers also stopped receiving “thank you” days, an extra allotment of paid time off, Morgan said.
“Everything we were told would be benefits at the time of hiring was slowly removed,” Morgan said. An Air Force veteran with a disability, Morgan said he received one day of notice before he lost his job as part of a round of layoffs in January 2024, after having been assured that his position had been safe over the months prior.
In a post on LinkedIn that month, Krause said the company had improved but still required personnel changes.
“Our focus on adding value for our long-standing customers while driving a much higher level of business discipline and accountability is bearing fruit — with customer retention and financial results for our first fiscal year as Cloud Software Group coming in ahead of plan,” Krause said.
“But change often means difficult decisions,” he wrote. “While we have a number of areas of the business where our plans involve additional hiring to support our goals, they also mean a pragmatic look at those places where we simply need fewer or different resources.”
In a direct message to Krause over LinkedIn days later, Morgan wrote, “It’s challenging to reconcile my dedication and commitment to the company with the feeling of being let go in a way that seemed to lack empathy.” It does not appear that Krause responded, according to a screenshot of the conversation reviewed by ABC News.
Another policy shift under Krause brought the implementation of employee-performance ratings on a scale of one to three, multiple former employees said.
The ratings took a toll on one former manager, who said the company required them to label at least one subordinate as a low performer. “I had to give one person a low score, even if I thought they didn’t really deserve a low score,” they said. “It was miserable.”
Rating systems have reportedly been deployed as part of the Trump administration’s recent push to cut staff. Senior staff across the Department of Health and Human Services were told to rank thousands of employees in probationary periods, with as much as 40% to be deemed non-mission critical, the Washington Post reported.
‘It’s very alarming’
Daniel Keum, a professor of management at Columbia University Business School, said the apparent overlap between cost-cutting initiatives at Cloud Software Group and some federal agencies exemplifies the Trump administration’s use of tactics borrowed from the private sector.
“In tech, there’s a mentality that you have to break things to make them a lot better,” Keum told ABC News. “When transposed into federal agencies, that mentality becomes very dicey.”
Nearly all former employees who spoke to ABC News expressed shock or concern about the role at the Treasury taken up by Krause, though one expressed indifference and another voiced support.
“It’s very alarming,” said Roan, the former Cloud Software Group design architect.
“He should absolutely not have anything to do with the U.S. Treasury Department,” said Morgan.
In contrast, a former account executive at the company applauded the choice of Krause for the Treasury role, citing his financial acumen.
“I don’t think you can find a better person to swim in the weeds [and] sit in the edifice of the Treasury Department,” the person said.
In January, Cloud Software Group conducted another round of layoffs. That same month, Krause sent an email to all employees asking them to voluntarily send him a message at the end of each week “telling me what you accomplished,” according to a copy of the email reviewed by ABC News.
The approach draws on best practices from “two great entrepreneurs and CEOs that lead the most valuable companies in the world,” Krause wrote, naming Musk and Nvidia CEO Jensen Huang.
In a separate email in recent days, Krause told employees that he plans to continue in his role at the company during his time at the Treasury, according to a copy of the email reviewed by ABC News that was first reported by CRN.
“I am honored to serve our country,” Krause wrote. “Let me be clear — as CEO of Cloud Software Group, I am committed to our company and to you, our employees.”
(NEW YORK) — U.S. stocks dropped on Tuesday, extending losses suffered a day earlier amid a fresh round of tariffs on Canada and concern about a possible recession.
The Dow Jones Industrial Average tumbled about 515 points, or 1.2%, while the S&P 500 fell 0.8%. The tech-heavy Nasdaq ticked down 0.4%.
The Tuesday selloff extended a days-long market decline touched off by U.S. tariffs imposed last week on Canada, Mexico and China, some of which were delayed.
President Donald Trump on Tuesday announced retaliatory measures on Canada after they slapped a 25% tariff on electricity sent to the U.S., saying that he is imposing an additional 25% tariff on steel and aluminum, bringing those tariffs to 50%.
The move escalated a global trade war that intensified a day earlier, when China slapped retaliatory tariffs on the U.S., deepening trade tensions between the world’s two largest economies.
On Monday, the tech-heavy Nasdaq plummeted 4%, recording its worst day of trading since 2022. The Dow Jones Industrial Average and S&P 500 each dropped more than 2% on Monday.
The market drawdown on Monday extended losses last week. The S&P 500 recorded its worst week since September.
When asked about a potential recession in an interview broadcast on Sunday, Trump said tariffs imposed in recent days could bring about a “period of transition.”
“I hate to predict things like that,” Trump told Fox News in an interview recorded on Thursday. “It takes a little time, but I think it should be great for us.”
In response to a question later on Sunday about his reluctance to rule out a recession, Trump said: “I tell you what, of course you hesitate. Who knows?”
The Bureau of Labor Statistics is expected Tuesday morning to release a report on how many jobs are open in the economy, which could provide another clue about the strength of economy amid the new recession concerns. An inflation report is expected Wednesday.
This is a developing story. Please check back for updates.
(NEW YORK) — Cryptocurrencies affiliated with President Donald Trump and first lady Melania Trump plummeted in the initial hours after Trump was sworn into office Monday.
“Official Trump,” a recently launched crypto token, plunged more than 20% in value over a 24-hour stretch ending Tuesday morning, according to crypto tracking site CoinGecko. After the drop, Official Trump stood at $38.
The decline for Trump’s meme coin reverses some of the gains enjoyed in an initial surge after it hit crypto markets last week. The coin’s price climbed from about $10 on Saturday morning to a high of about $74.59 before it began to slide.
“Melania Meme,” which also launched last week, dropped in value by more than half over a 24-hour timespan ending on Tuesday morning, CoinGecko data showed. The price of the Melania Meme was $4.19 on Tuesday morning.
The recent decline for the coins associated with Trump and Melania coincided with a slight drop for bitcoin, the world’s largest cryptocurrency. In early trading on Tuesday, bitcoin fell nearly one percentage point, putting its price at $102,853.
Many digital assets have climbed since Trump won the November election, indicating investor enthusiasm about declarations Trump made in support of cryptocurrency.
In July, Trump told the audience at a cryptocurrency conference in Nashville, Tennessee, that he wanted to turn the U.S. into the “crypto capital of the planet.”
Trump also has promised to ease regulations for the sector and establish the federal government’s first National Strategic Bitcoin Reserve.
On Monday, Securities and Exchange Commission Chair Gary Gensler officially resigned from his position, marking the departure long-sought by some crypto boosters who viewed Gensler as overly restrictive toward digital assets.
There have been reports that Trump would sign an executive action that would prioritize cryptocurrency policy. However, no such order was among the dozens of actions Trump signed
