US Private Payrolls Fall June Amid Low Layoffs

U.S. private payrolls unexpectedly fell by 33,000 jobs in June 2025, marking the first decline since March 2023, with job losses concentrated in professional and business services, education and health services, and financial activities, while leisure, hospitality, manufacturing, and construction sectors showed gains. Despite the decline, layoffs remained low, with U.S.-based employers announcing 47,999 job cuts in June, a 49% decrease from May, though the second quarter saw the highest total job cuts since 2020. The retail sector faced the most private-sector job cuts in 2025, attributed to tariffs, inflation, and consumer spending concerns, while the technology sector experienced significant cuts due to AI disruptions and visa uncertainties. Non-profits have also been severely affected by federal funding reductions, leading to a substantial increase in job losses in that sector. Overall, the labor market shows signs of hesitancy in hiring, influenced by trade policy uncertainty and economic factors, but widespread layoffs have not yet materialized, helping to anchor the market. Economists expect the official June employment report to show modest job gains despite the ADP data's downward revision and weak hiring indicators.