Closely watched US jobs report likely to show hiring slowed in June
[July 03, 2025] By
PAUL WISEMAN
The steady slowdown in U.S. hiring likely continued in June as President
Donald Trump’s trade wars, federal hiring freeze and immigration
crackdown weighed on the American job market.
When the Labor Department on Thursday releases job numbers for last
month, they’re expected to show that businesses, government agencies and
nonprofits added 115,000 jobs in June, down from 139,000 in May,
according to a survey of forecasters by the data firm FactSet.
The unemployment rate is expected to have ticked up to 4.3%, which would
be the highest since October 2021 but still low enough to suggest that
most American workers continue to enjoy job security.
The U.S. job market has cooled considerably from red-hot days of
2021-2023 when the economy bounced back with unexpected strength from
COVID-19 lockdowns and companies were desperate for workers. So far this
year employers have added an average 124,000 jobs a month, down from
168,000 in 2024 and an average 400,000 from 2021 through 2023.
Hiring decelerated after the Federal Reserve raised its benchmark
interest rate 11 times in 2022 and 2023. But the economy did not
collapse, defying widespread predictions that the higher borrowing costs
would cause a recession. Companies kept hiring, just at a more modest
pace.

But the job market increasingly looks under strain. A survey released
Wednesday by the payroll processor ADP found that private companies cut
33,000 jobs last month. “Though layoffs continue to be rare, a hesitancy
to hire and a reluctance to replace departing workers led to job losses
last month,” said ADP chief economist Nela Richardson. (The ADP numbers
frequently differ from the Labor Department’s official job count.)
Employers are now contending with fallout from Trump’s policies,
especially his aggressive use of import taxes – tariffs.
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Katy Frank, a former computer scientist at the NOAA Great Lakes
Environmental Research Lab, who lost her job Thursday, protests
outside the John D. Dingell Veterans Affairs Medical Center in
Detroit, Friday, Feb. 28, 2025. (AP Photo/Paul Sancya, File)
 Mainstream economists say that
tariffs raise prices for businesses and consumers alike and make the
economy less efficient by reducing competition. They also invite
retaliatory tariffs from other countries, hurting U.S. exporters.
The erratic way that Trump has rolled out his tariffs — announcing
and then suspending them, then coming up with new ones — has left
businesses bewildered.
Manufacturers responding to a survey released this week by the
Institute for Supply Management complained that they and their
customers were reluctant to make decisions until they understood
where Trump’s tariffs would end up. “That whiplash has to stop and
it has to stay stopped,” said Susan Spence, chair of the ISM’s
manufacturing survey committee.
Trump’s assault on the federal bureaucracy could also show up in
June’s job report. Nancy Vanden Houten, lead U.S. economist at
Oxford Economics, expects federal jobs dropped by 20,000 last month,
“reflecting a hiring freeze, voluntary quits and retirements.’’ For
now, she wrote in a commentary Wednesday, court rulings “have put
massive federal layoffs on hold.’’
The president’s deportations — and the threat of them — also are
likely to start having an impact on the job market by driving
immigrants out of the job market. In May, the U.S. labor force —
those working and looking for work — fell by 625,000, the biggest
drop in a year and a half.
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