Research
September 05, 2025
Total U.S. jobs
Nonfarm payroll employment has slowed materially over the past 4 months
The U.S. economy added just 22,000 nonfarm payroll jobs in August, a notable deceleration from the 79,000 jobs added in July and well below consensus expectations of 75,000. This marks a continuation of the summer slowdown in hiring, with employers adding only 107,000 net new jobs over the past four months. By comparison, the first four months of 2025 saw a robust gain of 491,000 jobs, underscoring the recent loss of momentum.
Revisions to the June and July employment figures further dampened the outlook, subtracting 21,000 jobs from previous estimates. Notably, June’s revised figure turned negative, marking the first month of job losses since December 2020.
Despite the slowdown, total nonfarm employment continues to edge higher, reaching a record 159.54 million. This represents a 4.8% increase from the pre-pandemic peak in February 2020, with 7.25 million more jobs added over that period.
The U.S. economy has demonstrated surprising resilience over the past two years, navigating multiple headwinds and an uncertain policy environment. However, the recent softening in labor market conditions could challenge the prevailing narrative of post-pandemic strength. Steady employment and wage growth have been key drivers of consumer spending, and any sustained weakness could weigh on economic activity.
Restaurant operators are closely monitoring labor trends as they seek to drive traffic and sales, especially given the recent softness. At the same time, while challenges remain, there are also positive indicators that could support performance in the sector, with mixed economic news overall. Labor market developments will be critical to watch in the coming months as businesses adapt to evolving economic and policy dynamics. One thing is increasingly clear: the latest employment data strengthens the case for the Federal Reserve to cut short-term interest rates at its upcoming meeting on September 16–17.
Job growth in August was mixed but more negative than not. There were gains in private education and health services, leisure and hospitality (including eating and drinking places), local government, other services, and trade, transportation and utilities. In contrast, employment declined in professional and business services, federal and state government, manufacturing, construction, mining and logging, information, and financial activities. The private sector added 38,000 jobs, while government employment declined by 16,000 overall. Below is a detailed breakdown of August’s employment changes by sector, ranked from highest to lowest:
Revisions to the June and July employment figures further dampened the outlook, subtracting 21,000 jobs from previous estimates. Notably, June’s revised figure turned negative, marking the first month of job losses since December 2020.
Despite the slowdown, total nonfarm employment continues to edge higher, reaching a record 159.54 million. This represents a 4.8% increase from the pre-pandemic peak in February 2020, with 7.25 million more jobs added over that period.
The U.S. economy has demonstrated surprising resilience over the past two years, navigating multiple headwinds and an uncertain policy environment. However, the recent softening in labor market conditions could challenge the prevailing narrative of post-pandemic strength. Steady employment and wage growth have been key drivers of consumer spending, and any sustained weakness could weigh on economic activity.
Restaurant operators are closely monitoring labor trends as they seek to drive traffic and sales, especially given the recent softness. At the same time, while challenges remain, there are also positive indicators that could support performance in the sector, with mixed economic news overall. Labor market developments will be critical to watch in the coming months as businesses adapt to evolving economic and policy dynamics. One thing is increasingly clear: the latest employment data strengthens the case for the Federal Reserve to cut short-term interest rates at its upcoming meeting on September 16–17.
Job growth in August was mixed but more negative than not. There were gains in private education and health services, leisure and hospitality (including eating and drinking places), local government, other services, and trade, transportation and utilities. In contrast, employment declined in professional and business services, federal and state government, manufacturing, construction, mining and logging, information, and financial activities. The private sector added 38,000 jobs, while government employment declined by 16,000 overall. Below is a detailed breakdown of August’s employment changes by sector, ranked from highest to lowest:
- Private education and health services: +46,000
- Leisure and hospitality: +28,000 (eating and drinking places: +11,000)
- Local government: +12,000
- Other services: +12,000
- Trade, transportation, and utilities: +2,000 (retail trade: +10,500)
- Financial activities: -3,000
- Information: -5,000
- Mining and logging: -6,000
- Construction: -7,000
- Manufacturing: -12,000
- State government: -13,000
- Federal government: -16,000
- Professional and business services: -17,000