US Labor Market Contracts in July as Payrolls Fall 23,000

The US labor market contracted in July, with nonfarm payrolls posting their first monthly decline in years.

The Bureau of Labor Statistics reported a seasonally adjusted decrease of 23,000 jobs in July, following a downwardly revised decline of 20,000 jobs in June.

Economists had expected employers to add 83,000 jobs during the month, but instead saw hiring weaken across several sectors.

Despite the decline in payrolls, the unemployment rate edged down to 4.1% from 4.2%, largely due to a drop in labor force participation, which slipped to 61.4%, the lowest level in over five years.