The U.S. economy added 57,000 jobs in June, while the unemployment rate ticked down to 4.2%, the government said Thursday. Why it matters: Hiring lost momentum after months of surprising strength — a sign that economic uncertainty might be weighing on employers.By the numbers: Jobs growth in June was roughly half the 115,000 job gains that economists expected.And the labor market looks weaker than first appeared in previous months: The Bureau of Labor Statistics said payrolls in April and May were a combined 74,000 lower than initially estimated.The intrigue: Notably, the labor market participation rate — those with a job or looking for one — fell 0.3 percentage point, as workers left the labor market in droves in June. That helps explain the drop-down in the unemployment rate. The big picture: The worse-than-expected jobs report comes after a string of reports that suggested that the hiring slowdown in 2025 appeared to be in the rearview mirror.The intrigue: Still, financial markets have anticipated that the Federal Reserve will move to control inflation by year-end. Price pressures have intensified as a result of the Middle East conflict, even as crude oil prices have returned to near pre-war levels. Federal Reserve chairman Kevin Warsh signaled little concern about the labor market on a European Central Bank panel in Portugal on Wednesday, but he declined to hint at whether the central bank planned to raise interest rates. Editor's note: This story has been updated with additional details.