US Job Growth Slows Sharply in July 2025

U.S. employers added only 73,000 jobs in July 2025, marking a sharp slowdown in hiring and pushing the unemployment rate up to 4.2%. Substantial downward revisions to May and June payrolls cut a combined 258,000 jobs, revealing a weaker labor market than previously reported. The slowdown is attributed to President Trump's aggressive tariff policies, immigration crackdowns reducing the labor supply, significant federal layoffs, and the ongoing impact of elevated interest rates. Despite these headwinds, layoffs remain limited and job security for most workers is relatively high. While GDP rebounded to 3% in Q2, overall growth for the first half of 2025 was sluggish at 1.2%, underlining persistent economic uncertainty. The Federal Reserve kept interest rates steady, with Chair Jerome Powell calling the labor market 'solid' but warning of downside risks.