July jobs mediocre, but revisions show US economy stalled out

It was the first Friday of the month, and I happened to be on line at 7:30 yesterday morning, so I figured I’d check in on the US jobs report for July. And by looking at the topline, I said…meh.

Total nonfarm payroll employment changed little in July (+73,000) and has shown little change since April, the U.S. Bureau of Labor Statistics (BLS) reported today. The unemployment rate, at 4.2 percent, also changed little in July. Employment continued to trend up in health care and in social assistance. Federal government continued to lose jobs.

Not great, but not awful and not much different than we would have thought. But then my eyes went to this picture, and it changed my opinion.

See that dropoff on the right end of the graph? I knew that the most recent jobs reports hadn’t said this when they were first released (the media generally said the June report was "better than expected" and that job growth was holding up). So what’s up with this?

Revisions for May and June were larger than normal. The change in total nonfarm payroll employment for May was revised down by 125,000, from +144,000 to +19,000, and the change for June was revised down by 133,000, from +147,000 to +14,000. With these revisions, employment in May and June combined is 258,000 lower than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.)

WELL THEN!

Factor in that jobs for the previous 2 months were revised down by 258,000, and we have 185,000 fewer jobs than we thought we did yesterday. That’s a big recalibration on where the jobs market stands, but it also matches up with several other recent economic reports that would indicate the real US economy has stalled out in the middle of 2025.

And those downward revisions were widespread. They show up in the public and private sectors, and in goods and services.

Interestingly, job cuts in the federal government had already been registered in May and June. But what got revised down in the public sector were jobs in state and local government (likely related to getting more information on education jobs as the school years end).

These newly revised numbers are reminiscent of the slump that hit private sector job growth in June, July and August 2024. But the difference then is that government employment was going up (+107,000 over those 3 months), and now it’s declining (down 49,000 total over the most recent 3 months). In addition, consumer spending growth is also weaker than it was last Summer.

In this time of a softening economy, we need a leader that needs to deal with this weakening and makes the necessary adjustments. So President Trump, what's the plan?

Unquestionably the most dangerous and corrupt attack on the independence of US economic data in American history. Trump is firing the head of the BLS, a longtime civil servant confirmed 86-8 by the Senate, simply because the job numbers came in below his expectations today

[image or embed]

— Joey Politano🏳️‍🌈 (@josephpolitano.bsky.social) August 1, 2025 at 1:25 PM

So shoot the messenger and create alternative numbers and spin? So policymakers become less likely to trust the data coming from the BLS after this? If anything, this would make the Fed less likely to pull the trigger on rate cuts, because they can't trust inflation and jobs data they’re getting from the BLS, and have to rely more on anecdotes and other sources.

It ain’t the messengers, Donnie. It’s the fact that your pointless austerity and poser tariff moves have halted the already-moderated growth that we had in 2024. And no numbers that you make up will change the reality when people can see jobs are being lost and the costs of groceries and health care premiums going up.

I'll let this guy sum up how incoherent TrumpWorld is on the jobs market and the economy are these days.

The economy is so good that I'm firing the BLS Commissioner for reporting numbers so grim I refuse to believe them, and also demanding the Fed cut rates typically seen during a recession.

— Justin Wolfers (@justinwolfers.bsky.social) August 2, 2025 at 6:28 AM