The US Employment Situation July 2026 report showed that total nonfarm payroll employment fell by 23,000 in July, while the unemployment rate remained unchanged at 4.1%, according to data released by the U.S. Bureau of Labor Statistics. Employment losses were concentrated in local government education and retail trade, while health care continued to add jobs. Average hourly earnings and the average workweek showed little change during the month.
The household survey showed that the number of unemployed people remained largely stable at 6.9 million in July. Over the past year, both unemployment and the jobless rate changed little. Among major worker groups, unemployment declined for teenagers, whose jobless rate fell to 12.1%, and for Hispanic workers, whose unemployment rate dropped to 4.6%.
The unemployment rates for adult men stood at 3.9%, while adult women recorded a rate of 3.7%. The rates for White, Black and Asian workers were 3.6%, 6.3% and 4.0%, respectively, showing little or no change from the previous month. The number of people on temporary layoff increased by 153,000 to 921,000, while permanent job losers remained largely unchanged at 1.7 million.
People unemployed for less than five weeks declined to 2.0 million, down by 344,000 from a year earlier. Long-term unemployed workers, defined as those without a job for 27 weeks or more, edged down to 1.8 million and accounted for 25.5% of all unemployed people in July.
US Employment Situation July 2026: Payrolls Decline as Key Sectors Lose Jobs
The establishment survey showed that total nonfarm payroll employment declined by 23,000 in July, compared with an average monthly increase of 34,000 over the previous 12 months. Local government education lost 50,000 jobs after showing little net change over the past year.
Retail trade employment fell by 19,000 jobs during the month. Warehouse clubs, supercenters and other general merchandise retailers lost 21,000 jobs, while gasoline stations and fuel dealers shed 5,000 jobs. However, sporting goods, hobby, musical instrument, book and miscellaneous retailers added 10,000 jobs. Overall, retail employment had shown little net change during the previous 12 months.
Financial activities continued to weaken, losing 14,000 jobs in July. Credit intermediation and related activities declined by 9,000 jobs, while insurance carriers and related activities lost 7,000 positions. Employment in financial activities has fallen by 121,000 jobs since reaching a recent peak in May 2025.
Health care remained one of the few sectors adding jobs. Employment in the sector increased by 22,000 in July, although the gain was lower than the average monthly increase of 36,000 recorded over the previous year. Ambulatory health care services accounted for 18,000 of the new jobs added during the month.
Other major sectors, including mining, quarrying and oil and gas extraction, construction, manufacturing, wholesale trade, transportation and warehousing, information, professional and business services, social assistance, leisure and hospitality, and other services, recorded little change in employment.
The US Employment Situation July 2026 report also showed limited movement in wages and working hours. Average hourly earnings for all employees on private nonfarm payrolls increased by just 2 cents to $37.62 in July and were up 3.2% compared with a year earlier. Private-sector production and nonsupervisory employees earned an average of $32.40 per hour, up 4 cents from June.
The average workweek for all private-sector employees remained unchanged at 34.3 hours. Manufacturing employees continued to work an average of 40.4 hours per week, while overtime hours edged down by 0.1 hour to 3.1 hours. Production and nonsupervisory workers maintained an average workweek of 33.8 hours.
The Bureau of Labor Statistics also revised earlier payroll figures lower. Job growth in May was revised down from 129,000 to 63,000, while June payroll gains were reduced from 57,000 to 20,000. Combined, the revisions lowered employment estimates for May and June by 103,000 jobs.
The next Employment Situation report for August 2026 will be released on Friday, September 4, 2026, at 8:30 a.m. Eastern Time. The Bureau of Labor Statistics will also publish the preliminary benchmark revision to establishment survey data on August 28, 2026, with the final benchmark revision scheduled for February 2027.
US Jobs Data Weakens, Treasury Yields Fall
US employers unexpectedly cut 23,000 jobs in July, while the unemployment rate eased to 4.1%. The weak payroll report and sharp downward revisions to previous months reduced expectations of a Federal Reserve rate hike in September. The labor-force participation rate also continued to decline.
Treasury yields fell after the data, with the two-year yield dropping 8 basis points to 4.16% and the 10-year yield falling from around 4.67% to 4.60%. Investors said a softer labor market could ease inflation pressures and lower the need for further policy tightening.
US stocks opened higher despite the weak jobs report, with the Dow up 0.23%, the S&P 500 gaining 0.31% and the Nasdaq rising 0.74%. White House adviser Kevin Hassett attributed the slowdown partly to baby-boomer retirements and temporary government and World Cup-related employment trends.
