People walk through a Manhattan shopping mall on July 5, 2024 in New York City.
Spencer Platt | Getty Images News | Getty Images
The pace of hiring in the United States slowed markedly last month, with the information and financial sectors recording job losses.
The information services sector was a notable weak spot in July, losing 20,000 jobs. Professional and business services and financial activities saw payrolls fall by 1,000 and 4,000 jobs, respectively.
“These sectors are known for creating higher-paying, higher-quality jobs,” said Julia Pollack, chief economist at Zip Recruiter. “The labor market is clearly not on its way to normalizing. Further deterioration could trigger a negative cycle of job losses, lower consumer spending, lower corporate revenues, and more job cuts.”
Nonfarm payrolls rose by just 114,000 jobs during the month, well below the Dow Jones estimate of 185,000. The unemployment rate rose to 4.3%, its highest level since October 2021.
There are certainly some relatively bright spots.
Once again, health care led the way in job creation, adding 55,000 jobs to the payroll. Other notable gains included construction (25,000 jobs), government (17,000 jobs), and transportation and warehousing (14,000 jobs). Leisure and hospitality, another sector that has seen big gains over the past few years, added 23,000 jobs.
“The latest picture of the labor market is consistent with a slowdown, not necessarily a recession. However, early warning signs point to further weakness,” said Jeffrey Roach, chief economist at LPL Financial.
