Yarn label needle size

Yarn labels have a recommended needle size and gauge. For example, I just bought Pound of Love by Lion Brand for a baby sweater. I think it’s a sport weight, #3 Medium. Suggested needle size is an 8. This is probably a dumb question, but do I have to knit with a size 8 or is this a maximum number guideline? I’m finding all kinds of info on how to read yarn labels. I get that. But nothing is ever said about the needle size symbol. Can anybody educate me on that one?

Pound of love is a worsted weight #4. If you knit it on a smaller needle it may be somewhat stiff and dense.

The needle given on the yarn label isn’t really the one ‘recommended’ for the yarn, it’s the one that gets the gauge which classifies the yarn into a weight class. The gauge and needle size for this yarn would put it in the worsted range. Most baby yarns are fingering weight and would use a size 3 or 4. Seethis chart, and this one.

Many patterns use a different needle than the one on the label and it also depends on what you’re making. Sock yarn used for socks is knit on size 0 to 3 because you need a dense knit for longer wearing. The same yarn used in a lace shawl can be knit on size 4 up to a 10 to make it loose and open.