People walk through a shopping mall in Manhattan, New York City on July 5, 2024.
Spencer Platt | Getty Images News | Getty Images
Hiring in the US fell sharply last month, with job losses in the information and finance sectors.
The information services sector was a particular weak spot in July, recording a loss of 20,000 jobs. The professional and business services sector and the financial sector saw employment declines of 1,000 and 4,000 respectively.
“These sectors are known for creating higher-paying, higher-quality jobs,” said Julia Pollak, chief economist at ZipRecruiter. “The labor market is clearly no longer normalizing. Further deterioration could trigger a negative cycle of job losses, falling consumer spending, declining sales and more job losses.”
Nonfarm payrolls grew by just 114,000 during the month, well below the Dow Jones estimate of 185,000. The unemployment rate rose to 4.3%, the highest since October 2021.
There were certainly some relative bright spots.
The health sector was once again the largest employer, with 55,000 new jobs. Other notable increases were recorded in the construction sector (25,000), public services (17,000) and transport and warehousing (14,000). The leisure and hospitality sector, another of the largest increases in recent years, also recorded 23,000 new jobs.
“The latest snapshot of the labor market points to a slowdown, not necessarily a recession. However, early warning signs point to further weakness,” said Jeffrey Roach, chief economist at LPL Financial.
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