US employers unexpectedly cut 23,000 jobs last month, and Bureau of Labor Statistics revisions shaved 103,000 jobs off payrolls in May and June. This was in sharp contrast with analyst expectations of an almost 100,000 spike in jobs in July.
However, the unemployment rate eased slightly to 4.1% in July, down from 4.2% in June, mainly due to more people leaving the labour market.
The July jobs numbers from the Bureau of Labor Statistics on Friday marked a sharp reversal for the domestic labour market and a political setback for President Donald Trump less than three months before his Republican Party seeks to keep full control of Congress in the midterm election.
Local public schools reduced 50,000 jobs last month, whereas 26,000 jobs were shed from restaurants and bars and 19,000 from retailers.
July's unemployment rate was the lowest since June 2025, as 264,000 people dropped out of the labour market. The share of those working or looking for work fell to 61.4%, the lowest since February 2021.
