US Labor Market Unexpectedly Sheds Jobs in July Amid Broad Weakness
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- July US jobs: -23,000 vs. +80k-88k expected.
- Revisions: June down to 20k; net -103,000 jobs.
- Unemployment rate drops to 4.1%; participation rate falls.
- Local government education lost 50,000 jobs in July.
The U.S. labor market unexpectedly contracted in July, with nonfarm payrolls falling by 23,000 jobs, significantly missing economists’ expectations for a gain of approximately 80,000 to 88,000. This decline was compounded by substantial downward revisions to prior months, including June’s figure being adjusted from an initial 57,000 to 20,000, resulting in a two-month net revision of -103,000. While the unemployment rate edged lower to 4.1% from 4.2%, the labor force participation rate simultaneously decreased to 61.4%, marking its lowest level in over five years. Furthermore, average hourly earnings growth slowed, rising 0.1% month-over-month and 3.2% year-over-year, both below forecasts, suggesting easing wage pressures. These figures collectively point to a notable cooling in the U.S. employment picture.
The U.S. economy unexpectedly shed 23,000 jobs in July, contrary to economist estimates for a gain of 80,000 to 88,000 jobs. The unemployment rate also fell to 4.1% from 4.2%. A notable factor in the job losses was a 50,000-job decline in local government education.