U.S. Job Growth Slows Sharply Amid Trade Turmoil; Unemployment Rises to 4.2%

U.S. Job Growth Slows Sharply Amid Trade Turmoil; Unemployment Rises to 4.2%

Last Updated Aug - 03 - 2025, 12:10 PM | Source : Fela news

U.S. hiring slumps as Trump’s trade policies unsettle markets; only 73,000 jobs added in July. Unemployment rises, job quits fall, and economists warn of deeper

U.S. job growth has slowed sharply, reflecting growing concerns over the country’s economic future, as President Donald Trump’s unpredictable trade policies unsettle businesses. According to the Labor Department, only 73,000 jobs were added last month—far below the 1,15,000 expected. In addition, revisions cut 2,58,000 jobs from May and June totals, and the unemployment rate rose to 4.2% as more people left the labor force and 2,21,000 more Americans became unemployed.

Scott Anderson, chief economist at BMO Capital Markets, noted a clear decline in labor market conditions, attributing it to the ongoing trade war and tighter immigration rules. “We anticipated this slowdown when tariffs and trade tensions escalated earlier this year,” he said, warning of a potential hard landing for the labor market. Many economists had predicted that the effects of trade disputes would become visible this summer, and the July jobs data seems to confirm those fears. Daniel Zhao of Glassdoor called it “the eye of the hurricane,” noting that the long-anticipated slowdown is now a reality. The dismal report rattled financial markets, causing the Dow to fall by over 600 points on Friday. In response, President Trump attacked Erika McEntarfer, head of the Bureau of Labor Statistics, demanding her immediate dismissal and accusing her of incompetence. He posted on Truth Social that she would be replaced with someone “more competent,” though experts note that monthly revisions to job data are routine and reflect delayed business responses to surveys, especially post-COVID.

Trump continues to push for a radical reworking of U.S. trade policy, abandoning decades of efforts to reduce global trade barriers and imposing broad tariffs. He argues this will restore domestic manufacturing and help offset the cost of his massive tax cuts signed into law on July 4. However, economists warn that tariffs ultimately raise prices for American consumers and businesses. Meanwhile, job mobility has slowed. The rate of people voluntarily leaving jobs—a key indicator of worker confidence—has dropped below pre-pandemic levels. Pamela Rader of Drees Homes in Kentucky noted that while hiring has improved slightly, today’s job seekers prioritize stability, work-life balance, and advancement opportunities over higher pay.

Share :