The U.S. Labor Market is Slowing

Today’s non-farm payrolls report sent a clear signal: the U.S. labor market is slowing more sharply than expected. Only 73,000 jobs were added in July—well below projections—and the unemployment rate ticked up to 4.2%. For manufacturers, the trend is especially sobering: factory payrolls declined for the third month in a row, hitting their lowest level in over three years.

Slower job growth may be fueling differing views within the Fed. Two Fed Governors dissented from the central bank's decision (first time that two governors dissented since the 1990s) to hold interest rates steady, warning that holding rates steady risks further weakening the labor market. Meanwhile, the clock is ticking on newly announced tariffs—set to take effect in just seven days. The looming deadline stems from a sweeping trade ultimatum issued to nearly 180 countries. For industrial leaders already squeezed by labor and input costs, the question isn't just monetary policy—it’s how multiple headwinds may collide.

Are you seeing this play out on the ground—in hiring, production, or planning? Drop a comment or DM to share how your team is preparing for what's ahead.