What is the current state of the U.S. job market?

The U.S. job market has slowed to its weakest pace since the COVID-19 pandemic, with July 2025 payrolls rising by only 73,000, well below expectations.

How has the Trump administration's policies affected the U.S. labor supply?

Some economists point to the Trump administration's immigration clampdown as a contributing factor to the declining labor supply in the U.S.

What is the Federal Reserve's stance on the U.S. job market?

Despite the Fed Chair's recent comments calling the labor market solid, the latest data suggests otherwise, with growing stress in the job market and increasing bets on a September rate cut.

Home / Business and Economy / U.S. Job Growth Slows to Pandemic-Era Lows, Recession Fears Loom

U.S. Job Growth Slows to Pandemic-Era Lows, Recession Fears Loom

1 Aug

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Summary

July payrolls rose by only 73,000, well below expectations
May and June job figures revised down by nearly 260,000
Unemployment rate steady at 4.2%, but participation rate drops to 3-year low

U.S. Job Growth Slows to Pandemic-Era Lows, Recession Fears Loom

According to the latest labor market data, the U.S. job growth has hit its weakest pace since the COVID-19 pandemic. In July 2025, payrolls rose by only 73,000, well below the 104,000 consensus forecast. Furthermore, the job figures for May and June were revised down by nearly 260,000, bringing the three-month average to a meager 35,000.

While the unemployment rate remained steady at 4.2%, the labor force participation rate dropped to 62.2%, a near three-year low. Some economists point to the Trump administration's immigration policies as a contributing factor to the declining labor supply. Additionally, ongoing federal job cuts, now in their sixth month, are weighing on local economies, particularly in regions dependent on government funding.

The weak jobs report has prompted investors to recalibrate their expectations. The S&P 500 opened lower, Treasury yields fell, and the dollar softened as bets on a September Federal Reserve rate cut gained momentum. Despite the Fed Chair's recent comments calling the labor market solid, the latest data suggests otherwise, with wage growth and broader indicators pointing to growing stress in the job market.

Disclaimer: This story has been auto-aggregated and auto-summarised by a computer program. This story has not been edited or created by the Feedzop team.