Nonfarm payrolls fell 23,000 in July as unemployment edged down to 4.1%

Employment Report: Nonfarm payroll employment declined by 23,000 in July, coming in below expectations. Meanwhile, May’s job gain was revised downward by 66,000 to a gain of 63,000 jobs, while June’s job gain was revised downward by 37,000 to 20,000 jobs. The 12-month average stands at 34,000 job gains per month. Government exhibited the most significant job loss, shedding 53,000 in July. At the same time, the unemployment rate edged down 0.1% from June to 4.1%, while the labor force participation rate ticked down 0.1% to 61.4% and is down from 62.2% in July 2025.

Manufacturing employment added 5,000 jobs in July after gaining 11,000 in June. On the other hand, the collective job gains in May and June of 1,000 were revised upward by 8,000 jobs to a gain of 9,000. Manufacturing employment is down 11,000 jobs over the year. Durable goods manufacturing employment rose by 18,000 in July, while nondurable goods employment fell by 13,000. The most significant gain in manufacturing in July occurred in motor vehicle and parts manufacturing, which added 7,900 jobs over the month. Meanwhile, the most significant loss occurred in food manufacturing, which shed 6,200 jobs over the month.

The employment-population ratio ticked down 0.1 percentage point from June to 58.9% in July and decreased 0.8 percentage points from a year ago. Meanwhile, the number of employed persons who are part-time for economic reasons grew by 123,000 from June to 4.8 million in July and up from 4.7 million in July 2025. Native-born employment rose by 318,000 from June but fell by 720,000 over the year. Meanwhile, foreign-born employment declined by 239,000 in July and 278,000 over the year. At the same time, the native-born unemployment rate decreased 0.1 percentage point over the year to 4.6%, while the foreign-born unemployment rate fell 0.8 percentage points to 3.3%.

Average hourly earnings for all private nonfarm employees edged up 0.1%, or 2 cents, reaching $37.62. Over the past year, earnings have grown 3.2%. The average workweek for all employees remained at 34.3 hours and stayed the same at 40.4 hours in July for manufacturing employees.