Labor Market Stays Afloat As Hiring Tops Forecasts—Again
Key Takeaways
Yet the number of new jobs added in 2025’s first half is down 37% compared to 2024’s.
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3 min read
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financial news
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July 3, 2025
08:32 AM
Forbes
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ToplineThe economy showed further signs of stability last month, according to a Thursday morning report from the Labor Department, defying recession warnings, though the full impact of tariffs remains un
The labor market has been steady in 2025 despite turbulence from tariffs, immigration and federal
More government shrinkage
Getty ImagesKey FactsThe unemployment rate dipped to 4. 1% last month, milder than economist forecasts of 4
Added 147,000 nonfarm jobs in June, compared to consensus economist estimates of 110,000, according to Dow Jones data
The Labor Department also revised April and May job growth upward by a combined 16,000, meaning the U
Added 53,000 more jobs than previously expected, when factoring in the June jobs beat
Key BackgroundThe primary jobs report s a concerning Wednesday from payroll cessor ADP
The company’s monthly private jobs report revealed private sector employment shrank by 33,000 from May to June, far worse than the 100,000 monthly growth forecasted by economists, marking the worst month for private sector employment since 2021
The unemployment rate is nearly a full percentage point higher than the 54-year low of 3. 4% achieved in 2023, though it remains within a range typical for non-recessionary periods; unemployment was 5% or higher from 2008 to 2015
Despite indications of a weaker labor market earlier in 2025, the Federal Reserve has yet to deploy its most powerful tool to jolt hiring: interest rate cuts
The Fed hasn’t cut rates since December as it takes a wait-and-see apach on tariffs, earning the ire of President Donald Trump, who called for Fed Chair Jerome Powell’s resignation Wednesday
Jobs Report Dries Up July Rate Cut HopesThe June jobs report indicated the labor market is not in little need of a monetary policy life raft, meaning the seemingly good news for the U
Economy was not so welcome for those Trump looking for swift rate cuts
The market-implied odds of a Fed rate cut this month sank from 24% to 7% early Thursday, according to CME Group’s FedWatch Tool
The data “completely dispels [the] case for imminent rate cuts and implies that there is absolutely no urgency for Fed support,” Seema Shah, Principal Asset Management’s chief global strategist, wrote in ed s
That’s how much lower job growth was in 2025’s first half than 2024’s, as the number of new nonfarm payroll positions declined from 985,000 to 619,000
Crucial Quote“The labor market might bend under the pressure of immigration restrictions and trade uncertainty, but we don't think it will break,” Bank of America economists led by Aditya Bhave wrote in a recent note to clients
The group forecasts the unemployment rate will rise further to 4. 5% by year’s end
Surprising FactFederal government employment declined 7,000 in May and is down by 69,000 since January, as the Trump and Elon Musk-led efforts to cull the number of civil servants took hold.
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