July nonfarm payrolls decline by 23K, missing expectations by a wide margin

The US labor market just posted its worst month of 2026, and it wasn’t even close to what economists had penciled in. Nonfarm payrolls fell by 23,000 in July, according to the Bureau of Labor Statistics report released on August 7. Wall Street had been expecting a gain of roughly 80,000. The numbers behind the miss June’s already-soft payroll figure of 57,000 was revised even lower, making July’s outright decline feel less like a sudden shock and more like the second act of a deteriorating trend. The unemployment rate held steady at 4.1%, with approximately 6.9 million Americans counted as unemployed. The job losses were concentrated in two areas: local government education and retail trade. Average hourly earnings barely moved during the month, which is a double-edged data point. On one hand, stable wages mean inflation isn’t getting fresh fuel from the labor side. On the other, flat pay growth in a shrinking job market isn’t exactly a sign of worker leverage. The private-sector picture wasn’t any prettier. ADP’s National Employment Report showed private payrolls growing by just 44,000 in July. That fell short of the 75,000 consensus forecast and marked the smallest monthly increa...