WASHINGTON, D.C.: U.S. private sector hiring exceeded expectations in March, suggesting some underlying strength in the labor market despite broader concerns about the economic outlook and rising trade tensions.

The ADP National Employment Report released this week showed that private payrolls rose by 155,000 jobs last month, surpassing economists' expectations for a gain of 115,000. February's increase was also revised up to 84,000 from the previously reported 77,000.

The job growth was broad-based. The goods-producing sector added 24,000 jobs, while service-providing industries contributed 132,000.

Still, many economists caution that this uptick doesn't signal a reversal in overall labor market trends, which have shown signs of cooling in recent months.

Labor indicators from small businesses, regional Fed banks, and consumer sentiment surveys have all pointed to a slowing job market. Much of the uncertainty stems from President Donald Trump's recent wave of tariff announcements.

"We would expect the broad rise in uncertainty about the economy is not only restraining firms from taking on new employees, but it is also restraining firms from laying off workers," said Carl Weinberg, chief economist at High Frequency Economics. "It costs money to fire people, and more money if you have to hire them back because things are not as bad as they were thought to be."

The ADP report, developed in collaboration with the Stanford Digital Economy Lab, precedes the more closely watched Labor Department report, due to be released on April 4. However, economists note that ADP and government figures often diverge.

Trump unveiled new reciprocal tariffs on April 2 —an event he branded "Liberation Day." He argued tariffs would help fund tax cuts and revive U.S. manufacturing.

But sentiment among businesses and consumers has taken a hit. Coupled with deep federal spending cuts that have already led to job losses, analysts are warning of rising recession risks.

Government data this week showed a decline in job openings and subdued hiring activity in February. There were 1.07 job openings for every unemployed person, down from 1.13 the month prior.

"As usual, we recommend that you disregard ADP's forecast for private payrolls, given its poor track record in recent years," said Oliver Allen, senior U.S. economist at Pantheon Macroeconomics. "ADP's sector-level forecasts are equally unreliable. In short, ADP adds no value."