July Jobs Report: U.S. Payrolls Fell 23,000 as BLS Revises Prior Months Down 103,000

U.S. employers unexpectedly cut jobs in July, with the Bureau of Labor Statistics reporting Friday that nonfarm payrolls fell by 23,000 and sharply revising down the prior two months by a combined 103,000. Together, the new figures paint a materially weaker picture of the labor market than earlier reports suggested.

The July number was a significant miss. Economists had expected job growth, with Axios reporting a consensus forecast of about 87,000 added jobs. The softer-than-expected report quickly became a political flashpoint, with Democrats moving to use the data to attack President Donald Trump’s economic record.

The unemployment rate was 4.1% in July, representing 6.9 million unemployed people, according to the BLS. The labor force participation rate — the share of people working or looking for work — was 61.4%, while the employment-population ratio, which measures the share of the population that is employed, was 58.9%. Average hourly earnings for private-sector workers rose by 2 cents in July to $37.62 and were up 3.2% from a year earlier.

The sector details showed weakness in several areas. Local government education was the biggest drag, losing 50,000 jobs in July. Retail trade shed 19,000 jobs, and financial activities lost 14,000. Health care was a notable area of growth, adding 22,000 jobs.

The revisions to prior months were also substantial. May payroll growth was revised down by 66,000, from 129,000 to 63,000, and June was revised down by 37,000, from 57,000 to 20,000. That left May and June payrolls 103,000 lower than previously reported. The BLS said the 12-month average monthly payroll gain now stands at 34,000, underscoring how soft hiring has become.

The agency said revisions are a routine part of the monthly jobs report as more complete data arrives. “Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors,” the BLS said in its Employment Situation for July 2026. The report also draws from two separate surveys: the establishment survey, which produces the payroll figure, and the household survey, which produces the unemployment rate. That is why payrolls can fall even as the unemployment rate holds relatively low.

On the political side, the Democratic National Committee seized on the report as evidence of economic weakness under Trump. “Is this the ‘Golden Age’ that Donald Trump and JD Vance keep talking about? Trump’s disastrous economic agenda has caused irreparable damage to the job market, as layoffs mount and it’s nearly impossible to find a job,” Kendall Witmer, the DNC’s rapid response director, said in a statement published Friday. That claim is a political argument, not a finding by the BLS, which reported the data but did not assign blame for the deterioration. The next notable labor-market update is scheduled for Aug. 28, when the BLS is due to release a preliminary benchmark revision to establishment-survey data that could further alter payroll levels.