June’s jobs report did not just miss expectations; it also complicated the story economists had been telling about a labor market that might be reaccelerating into summer. Payrolls rose by only 57,000, and both April and May were revised down by a combined 74,000 jobs, which means the recent pace of hiring looks weaker in retrospect than it did on the day those reports were first released. That matters because revisions can change the signal from a single month’s surprise into a broader pattern of slowing momentum.
In a statement sent to Fortune, Glassdoor Chief Economist Daniel Zhao said the report “put a damper on the fireworks” and left the labor market looking “more fizzle than sparkle,” arguing that the unemployment rate’s drop to 4.2% is less reassuring than it appears because it was driven by a fall in labor force participation to 61.5%, not by a surge in hiring.
LPL Financial Chief Economist Jeffrey Roach made a quick calculation and noted that it means an additional 2.5 million have dropped out of the labor force since last year. Zooming further out, it means that Americans not in the labor force rose to 105.8 million, “most likely due to folks giving up looking for work,” which he called a “concerning trend.” The bottom line for Roach, he wrote, is that firms are still adding to their payrolls, but hours worked are below pre-pandemic levels as firms cut back.
