US job creation revised sharply lower<\/p>\n
Newsflash: Employment growth across America has been much weaker than previously thought over the last three months \u2013 a sign that the US labor market may be cooling.<\/p>\n
The latest non-farm payroll, just released, shows that US employment rose by just 73,000 in July, rather weaker than the 110,000 new jobs expected.<\/p>\n
But the big shock comes in the latest revisions to payrolls, with previous estimates for both May and June being revised sharply lower.<\/p>\n
The Bureau of Labor Statistics now estimates that just 19,000 new jobs were created in May, 125,000 fewer than the 144,000 previously estimated.<\/p>\n
June\u2019s data has been revised down too – showing that just 14,000 new jobs were created, not the 147,000 reported a month ago<\/a>.<\/p>\n That means 258,000 fewer jobs were created in May and June than previously thought.<\/p>\n The US unemployment rate has risen to 4.2% from 4.1% in June.<\/p>\n This surprisingly weak data may be a sign that Donald Trump\u2019s trade wars, and the associated uncertainty, have cause more damage to the US economy than previously thought. There could also be an impact from cost-cutting DOGE program pushed by Elon Musk.<\/p>\n The BLS says:<\/p>\n Employment continued to trend up in health care and in social assistance. Federal government continued to lose jobs.<\/p>\n Share<\/a><\/p>\n Updated at\u00a008.48 EDT<\/p>\n Key events<\/p>\n Show key events only<\/p>\n Please turn on JavaScript to use this feature<\/p>\n This chart shows just how bad the last three months have been for job creation in the US:<\/p>\n A chart showing US non-farm payroll data<\/a>Share<\/a>Trump demands interest rate cut<\/p>\n Donald Trump has again repeated his plea for the US Federal Reserve to cut interest rates.<\/p>\n Shortly after today\u2019s weak jobs report was released, Trump posted on his Truth Social site:<\/p>\n Too Little, Too Late. Jerome \u201cToo Late\u201d Powell is a disaster. DROP THE RATE! The good news is that Tariffs are bringing Billions of Dollars into the USA!<\/p>\n [factcheck: Tariffs are paid by the company or individual importing goods into America. They only way they can \u2018bring in dollars\u2019 is if the exporting company lowers its prices, to keep its goods competitive, meaning the importer doesn\u2019t suffer a relative loss once it has paid the tariff].<\/p>\n Share<\/a>US dollar slides after weak jobs report<\/p>\n The US dollar is being hammered on the foreign exchange markets, as today\u2019s weak jobs report alarms traders.<\/p>\n The dollar index, which tracks the greenback against a basket of currencies, is now down 0.9% today.<\/p>\n The euro has surged by almost a cent and a half, to $1.154, while the pound is up three-quarters of a cent at $1.328.<\/p>\n Share<\/a><\/p>\n Here\u2019s snap reaction from Heather Long, chief economist at credit union Navy Federal:<\/p>\n This is a gamechanger jobs report. July job gains were a mere 73,000 Note: 75% of the jobs in July came from healthcare<\/p>\n This puts a September rate cut from the Federal Reserve back on the\u2026 pic.twitter.com\/AgmMJNAvuB<\/a><\/p>\n \u2014 Heather Long (@byHeatherLong) August 1, 2025<\/a>Share<\/a><\/p>\n Today\u2019s surprisingly weak US jobs report is causing ructions in the market.<\/p>\n The yields, or interest rates, on US government bonds are falling sharply \u2013 a sign that investors are piling into bonds because they expect cuts to US interest rates to support the economy, or are simply seeking a safe-haven asset.<\/p>\n Reuters has the details:<\/p>\n US. Treasury yields fell after data showed on Friday the world\u2019s largest economy created fewer jobs than expected in July, increasing the odds that the Federal Reserve will resume cutting interest rates at the September meeting.<\/p>\n U.S. two-year yields, which are tied to the Fed\u2019s monetary policy, dropped 14.2 bps to 3.811%.<\/p>\n UK government bond yields \u2013 which track the cost of Britain\u2019s government borrowing \u2013 have also dropped.<\/p>\n Share<\/a>US job creation revised sharply lower<\/p>\n Newsflash: Employment growth across America has been much weaker than previously thought over the last three months \u2013 a sign that the US labor market may be cooling.<\/p>\n The latest non-farm payroll, just released, shows that US employment rose by just 73,000 in July, rather weaker than the 110,000 new jobs expected.<\/p>\n But the big shock comes in the latest revisions to payrolls, with previous estimates for both May and June being revised sharply lower.<\/p>\n The Bureau of Labor Statistics now estimates that just 19,000 new jobs were created in May, 125,000 fewer than the 144,000 previously estimated.<\/p>\n June\u2019s data has been revised down too – showing that just 14,000 new jobs were created, not the 147,000 reported a month ago<\/a>.<\/p>\n That means 258,000 fewer jobs were created in May and June than previously thought.<\/p>\n The US unemployment rate has risen to 4.2% from 4.1% in June.<\/p>\n This surprisingly weak data may be a sign that Donald Trump\u2019s trade wars, and the associated uncertainty, have cause more damage to the US economy than previously thought. There could also be an impact from cost-cutting DOGE program pushed by Elon Musk.<\/p>\n The BLS says:<\/p>\n Employment continued to trend up in health care and in social assistance. Federal government continued to lose jobs.<\/p>\n Share<\/a><\/p>\n Updated at\u00a008.48 EDT<\/p>\n Donald Trump\u2019s tariff playbook is becoming clearer following last night\u2019s announcement, says Paul Diggle, chief economist at Aberdeen Investments.<\/p>\n This playbook consists of:<\/p>\n A 10% global baseline tariff<\/p>\n A rate of at least 15% on countries with goods trade deficits with the US<\/p>\n An additional 40% on goods transhipped to evade higher rates elsewhere<\/p>\n A variety of new country-specific rates on smaller trading partners, such as 20% on Taiwan or 39% on Switzerland<\/p>\n Trump has also announced a 35% tariff on Canada, although the carve-out for USMCA-compliant trade remains [that\u2019s the United States-Mexico-Canada Agreement<\/a>]<\/p>\n Diggle adds that there are still plenty of uncertainties, including where US-China tariffs settle\u2026.<\/p>\n Share<\/a><\/p>\n Last night\u2019s tariff announcement contained some good news for the African country of Lesotho.<\/p>\n Donald Trump has lowered Lesotho\u2019s tariff rate to 15%, having previously threatened it with a 50% rate.<\/p>\n That should make it easier for manufacturers in Lesotho \u2013 which last month declared a national state of disaster over the country\u2019s \u201chigh rates of youth unemployment and job losses\u201d \u2013 to sell their goods to American consumers.<\/p>\n The BBC reported earlier this week<\/a> that a Lesotho garment factory, which has produced Trump-branded golf shirts, was at risk of shutting down due to the high tariffs\u2026.<\/p>\n Share<\/a>A summary<\/p>\n A quick recap.<\/p>\n Stock markets in Europe and across Asia-Pacific countries have fallen after Donald Trump<\/a> announced new tariffs on dozens of US trading partners.<\/p>\n Last night, as the latest deadline to reach deals approached, Trump signed an executive order imposing tariffs ranging from 10% to 41%.<\/p>\n Rates were set at 25% for India, 20% for Taiwan and 30% for South Africa<\/a> <\/a>ahead of Trump\u2019s self-imposed deadline of 1 August for striking trade deals with countries worldwide.<\/p>\n Trump also extended the deadline for a tariff agreement with Mexico by another 90 days.<\/p>\n Share prices have weakened in response \u2013 with Germany\u2019s DAX down 1.9% and France\u2019s CAC losing 2.2%, as European stock markets fell to a one-month low<\/a>.<\/p>\n Asia-Pacific stock markets were on track for their worst week since April<\/a>, with Japan\u2019s Nikkei 225 losing 0.6%,<\/p>\n South Africa\u2019s stock market is now down almost 1.5%.<\/p>\n Canada\u2019s prime minister, Mark Carney, said he was disappointed that Donald Trump was raising its tariffs from 25% to 35%<\/a>.<\/p>\n And there was shock in Switzerland, which has been lumbered with a 39% tariff rate<\/a> \u2013 which manufacturers fear will lead to job losses.<\/p>\n Share<\/a><\/p>\n Updated at\u00a007.29 EDT<\/p>\n European selloff deepens<\/p>\n The European stock market selloff is gathering pace.<\/p>\n After a volatile morning, Germany\u2019s DAX index and Italy\u2019s FTSE MIB are both down 1.9% while France\u2019s CAC has lost 2.3%.<\/p>\n Joshua Mahony, chief market analyst at financial services group Rostro, reports that sentiment in the markets has \u2018soured\u2019 after last night\u2019s tariff announcements from the White House.<\/p>\n Global markets are heading lower as we close out a week of major volatility, with a raft of corporate, economic, central bank, and trade headlines hitting the newswires on a daily basis. For the most part we have seen the strength of US tech earnings and positive trade agreements helping to prop up market sentiment for many markets, although that strength has started to falter as risks grow. With the DAX falling to the lowest level in a month, we have clearly started to see sentiment sour after relative stability.<\/p>\n The announcement of tariff levels across the globe has provided a follow up to the initial \u2018Liberation Day\u2019 cardboard cutout, with the new levels providing many with lower tariffs than had initially been set out. Notably, those rates come into play in a weeks\u2019 time, providing hope for those seeking fresh trade agreements before the heftier tax levels come into play.<\/p>\n Share<\/a><\/p>\n Many companies will be confused about how the new US tariffs apply to them, warns Andrew Wilson, deputy secretary-general of the International Chamber of Commerce (ICC).<\/p>\n Wilson explains:<\/p>\n \u201cAt a macro level, last night\u2019s announcement provides confirmation that the administration is set on applying generally higher tariff rates. So, the TACO logic seems to be off the menu.<\/p>\n But at a more practical level, we still see companies struggling to understand how the country specific rates will apply in practice.<\/p>\n The Executive Order (EO) only states the headline tariff rate, with no specifics as regards their implementation aside from the EU deal.<\/p>\n As such, there are still widespread questions about which tariffs will stack \u2014 the Japan deal for instance is notably silent on this issue compared to the EU agreement.<\/p>\n So, clarity on the direction of travel. But many questions remain about implementation and the real world implications.\u201d<\/p>\n As an example, the information released by the White House last night <\/a>showed that Brazil now faced a tariff of 10%. However, on Wednesday Trump signed an executive order confirming that the US would impose 50% tariffs on Brazil<\/a>.<\/p>\n And as my colleague Lisa O\u2019Carroll explained in her earlier post<\/a>, the European Union\u2019s trade deal with the US (a 15% tariff, agreed last weekend) is not stacked on top of a pre-existing tariff, meaning it\u2019s a better deal than many other countries.<\/p>\n Share<\/a><\/p>\n The US dollar has hit its highest level in two months against a basket of currencies today.<\/p>\n The dollar index has risen by 0.1%, on track for its seventh daily rise in a row.<\/p>\n Traders may be calculating that Trump\u2019s tariffs will be inflationary, pushing prices paid by consumers and making it harder for the US Federal Reserve to lower interest rates. They could also be factoring in the damage that the trade war will do to other countries, which could force their central banks to keep interest rates lower.<\/p>\n Share<\/a>Job loss fears over Swiss tariffs<\/p>\n Donald Trump\u2019s decision to hit Switzerland with a 39% tariff rate has caused shock in the markets, and in the Swiss Confederation.<\/p>\n Swiss president Karin Keller-Sutter posted on X last night that she spoke to Donald Trump on Thursday, but that the two country\u2019s hadn\u2019t reached an agreement.<\/p>\n She explained:<\/p>\n I had a final conversation today with US President Trump before the deadline for US tariffs expires. For the President, the trade deficit is the main focus. No agreement could be reached on the letter of intent negotiated between Switzerland and the USA.<\/p>\n The Swiss government says (see earlier post<\/a>) it \u201ccontinues to strive for a negotiated solution\u201d over a tariff announcement which it \u201cnotes with regret\u201d; manufacturers are warning that jobs are at risk.<\/p>\n Stefan Brupbacher, director of manufacturers\u2019 association Swissmem, said:<\/p>\n \u201cI am stunned. These tariffs are based on no rational basis and are arbitrary.<\/p>\n \u201cThis decision puts tens of thousands of jobs in the industry at risk.\u201d<\/p>\n Swissmechanic, an industry lobby group, called the 39% rate \u201cdangerous.\u201d<\/p>\n It urged the government to keep negotiating in the remaining time until the tariffs are set to come into effect on 7 August, which otherwise risks leaving the economy becoming \u201cone of the few countries that permanently struggle with structural competitive disadvantages\u201d, Bloomberg reports.<\/p>\n As flagged earlier, shares in Watches of Switzerland have fallen sharply in London \u2013 they\u2019re now down almost 9%.<\/p>\n Kathleen Brooks, research director at XTB, says Switzerland got the rough end of Trump\u2019s trade war, explaining:<\/p>\n The Swiss rate was a shock, and the Swiss government have said that they plan to keep negotiating with the US to secure a lower levy. Chocolatiers, watch makers and pharma companies are all under threat. Pharma accounts for 50% of Swiss exports to the US. Swiss pharma giant Novartis\u2019s share price is lower by 2% today, while Roche is lower more than 3% on Friday. Swiss pharma giants are also pressured by Trump\u2019s campaign to force drug makers to charge lower prices for US consumers and demanding that they charge the same rate for the US as they do for other countries.<\/p>\n Switzerland will hope to secure the same rate as the EU, but time is running out. It appears that Switzerland may have been punished more than elsewhere because of the Swiss government\u2019s desire to protect its openness, and to protect its domestic agriculture. Although it had said it was willing to lower import rates for fruit, nuts, shellfish and some medical devices, this was not enough for the US.<\/p>\n Share<\/a><\/p>\n Today\u2019s selloff has dragged European stock markets down to a one-month low.<\/p>\n The pan-European Stoxx 600 index is now down 1.1% at its lowest level since late June.<\/p>\n European pharmaceuticals stocks have dropped after Donald Trump<\/a> wrote to executives at 17 companies on Thursday, demanding they match their US prices for prescription drugs with the lowest price offered in other developed nations.<\/p>\n Share<\/a><\/p>\n Updated at\u00a006.13 EDT<\/p>\n Taiwan\u2019s government is hoping that it can negotiate its new US tariff down, before the new deadline of 7 August.<\/p>\n Taiwanese president Lai Ching-te said today that the new 20% tariff rate set by the Trump administration<\/a> on goods imported from the island is \u201ctemporary\u201d, and the government expects to negotiate a lower figure.<\/p>\n Lai also noted that rates for semiconductors, electronics as well as information and communication technology will be subject to separate U.S. sectoral tariffs and are still to be worked out.<\/p>\n Lai told a press briefing:<\/p>\n \u201cThe 20% tariff rate was never Taiwan\u2019s target to begin with. We will continue negotiations and strive for a rate that\u2019s more favourable for Taiwan.\u201d<\/p>\n Share<\/a>French wine exporters see \u20ac1bn losses from Trump tariffFrench vineyards in the Champagne region Photograph: Danita Delimont Creative\/Alamy<\/p>\n France\u2019s wine and spirits industry expects to lose \u20ac1bn should the US go ahead with imposing a 15% import tariff on their products next week, as the European Union makes a last-ditch effort to obtain an exemption, Bloomberg reports.<\/p>\n The levy, due to come into force on 7 August, will likely cut a quarter of France\u2019s annual exports from the sector, the country\u2019s federation of wine and spirit exporters FEVS said in a statement on Friday.<\/p>\n It will also jeopardize the jobs of the 600,000 people directly employed by the industry, they fear.<\/p>\n FEVS President Gabriel Picard said:<\/p>\n \u201cWe welcome the efforts already made to try to obtain the exclusion of wines and spirits from this 15% duty.<\/p>\n \u201cThe situation cannot remain as it is. It is vital that France and the European Union actively engage with us to very concretely support our sector.\u201d<\/p>\n
The labor market now looks a lot weaker than expected. <\/p>\n
June just 14,000
May just 19,000<\/p>\n