U.S. employers unexpectedly cut 23,000 jobs in July, according to data released Friday by the Bureau of Labor Statistics. This loss comes despite projections from the Dow Jones consensus that payrolls would increase by 83,000 and other economists forecasting 95,000 new hires.
Labor Department revisions further weakened the outlook, shaving 103,000 jobs off payrolls for May and June. While the labor market went into reverse, the unemployment rate ticked down to 4.1 percent as Americans left the job market.
The decline was particularly significant in the education, government, and retail sectors. These results suggest the labor market is weaker than previously thought and has not stabilized following four months of positive growth.
Economists, however, urged against interpreting this data as a sign of an abrupt deterioration in the labor market. Instead, they have viewed the current environment as being in a slow hire, slow fire mode.