U.S. employers added 114,000 jobs in July, far short of forecasts, and unemployment rose to 4.3 percent, the highest level since 2021.According to The New York Times, U.S. employers added 114,000 jobs in July, falling short of expectations, and the unemployment rate rose to 4.3 percent, the highest level since 2021.

The latest report from the Labor Department showed a significant slowdown in hiring, raising concerns that the economy may be cooling faster than anticipated. This marks the second smallest gain in job growth in the past 43 months, despite a consistent trend of job growth.

The increase in unemployment also adds to worries that the Federal Reserve may have waited too long to cut interest rates, potentially leading to a downward spiral in the labor market. While the Fed left the benchmark interest rate unchanged at 5.3 percent this week, they hinted at the possibility of a rate cut at their next meeting in September.

Economists are also concerned about the deceleration in wage growth, with average hourly earnings only increasing by 0.2 percent from the previous month and 3.6 percent from a year earlier. Additionally, there was an increase in the number of people working part-time who would prefer full-time employment, and a slight decrease in the number of hours worked per week, indicating a weakening demand for workers.

The job gains in July were concentrated in a few sectors, including education and health, construction, and leisure and hospitality. However, there were job losses in the information sector, and minimal gains in manufacturing and business services.

Overall, the latest jobs report highlights the potential challenges facing the U.S. economy and the need for the Federal Reserve to closely monitor and potentially adjust their policies to support continued growth. 

Source:Read More