US employers still reluctant to add many jobs as hiring slows in June
U.S. employers added 209,000 jobs in June, the smallest gain in 2.5 years, signaling a slowdown in hiring amid economic uncertainty. The unemployment rate fell from 3.7% to 3.6%, while average hourly wages rose 4.4% from a year earlier, still above pre-pandemic levels but showing signs of cooling.
Background
- The U.S. Bureau of Labor Statistics (BLS) releases a monthly "jobs report" on the first Friday of each month, tracking nonfarm payrolls and the unemployment rate. It is the most closely watched indicator of U.S. economic health.
- "Nonfarm payrolls" counts paid employees in the U.S. economy, excluding farm workers, private household workers, and a few other categories. It is the headline number for job growth.
- This report covers June 2025 hiring data. "Reluctant to add many jobs" means job growth was slower than economists expected, a sign the economy may be cooling.
- The Federal Reserve (the U.S. central bank) has been raising interest rates since 2022 to fight inflation. Higher rates make borrowing more expensive, which typically slows hiring and spending. The jobs report influences whether the Fed will keep raising rates, pause, or start cutting them.
- "Recession fears" refers to concern that the economy could shrink for two consecutive quarters, leading to widespread job losses. Slowing hiring can be a precursor to a recession, though not always.