The US economy unexpectedly lost 23,000 jobs last month

By Alicia Wallace, CNN

(CNN) — A summer hiring slump dogged the US labor market in July as the economy unexpectedly lost 23,000 jobs, according to new data released Friday by the Bureau of Labor Statistics.

The unemployment rate dropped to 4.1% from 4.2%.

July’s job gains marked a sharp slowdown from June’s total, which was downwardly revised to 20,000 from 57,000. Following revisions, May’s employment gains were essentially halved, dropping to 66,000 from 129,000.

The July report fell far short of economists’ expectations for a 95,000-job gain.

Friday’s report adds to signs that employers are becoming more cautious about hiring as they navigate growing headwinds, which include an aging population, the rapid adoption of AI, higher oil prices, policy uncertainty and the war with Iran.

Driving July’s job losses were sectors such as local government, which shed 57,000 jobs; and leisure and hospitality, which drop of 40,000 jobs.

The government’s monthly snapshot of the labor market is composed of two surveys, one of households and the other of businesses. When the monthly report is released, the initial estimate is often based on incomplete data and is revised twice further in the following jobs reports as the BLS receives more complete information.

This story is developing and will be updated.

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