The Labor Department reported that the economy lost jobs in June for the first time in 4.5 years. Economists attribute the slowdown to President Donald Trump’s import tariffs and immigration policies, which have reduced the labor pool. In July, unemployed individuals outnumbered job vacancies for the first time since the pandemic.
00:00U.S. job growth in August weakened significantly, with the unemployment rate rising to 4.3 percent, its highest in nearly four years, signaling a softening labor market and strengthening the case for a Federal Reserve rate cut this month.
00:13The Labor Department reported that the economy lost jobs in June for the first time in 4.5 years. Economists attribute the slowdown to President Donald Trump's import tariffs and immigration policy, which have reduced the labor pool.
00:26In July, unemployment individuals outnumbered job vacancy for the first time since the pandemic. Trump's tariffs, now at their highest since 1934, raised inflation concerns and led the Fed to pause rate cuts.
00:41Although trade uncertainty was easing, a recent court ruling declared many tariffs illegal, adding to business instability.
00:48Non-farm payrolls rose by just 22,000 in August, down from a revised 79,000 in July. June's figures were also revised to show a loss of 13,000 jobs.
01:00The unemployment rate ticked up from 4.2 percent, partly due to increased labor force participation.
01:06Some of August's weakness may be seasonal, as initial counts often understate job growth.
01:11Still, the three-month average has dropped to 29,000 jobs per month, compared to 82,000 in the same period last year.
01:20Healthcare-led job gains with 31,000 new positions, though below its 12-month average of 42,000, indicating strain even in traditionally strong sectors.
01:30New hiring has truly ground to a halt, and that's a dynamic we've really seen in place since April, when tariffs were announced.
01:39We're seeing a high degree of caution on the part of employers, and not much luck for those who are in the job market or looking to assess what their future prospects might be for their careers.
01:52Right now, we're seeing an unemployment rate that's still strong by historical standards, but the level of new hiring is quite dismaying.
02:02And the fact that we saw contraction in a recent month, meaning a job loss, really speaks to the anemic showing that the job market is exhibiting as we speak.
02:13If you look beneath the headline numbers, the sector participation is among the areas that point to weakness in the job market.
02:20And for several months now, we've really been seeing sort of the recession-resistant sectors, health care, and social assistance do a lot of the heavy lifting of hiring.
02:32And that broad situation is not one where there is any heavy lifting going on.
02:37We did see some improvement here in retail and leisure and hospitality.
02:41But those two areas, which previously had been quite dynamic in the reopening of the U.S. economy, have been rather lackluster in recent months.
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