U.S. employers pulled back on hiring in June

By — Christopher Rugaber, Associated Press Christopher Rugaber, Associated Press Leave your feedback Share Copy URL https://www.pbs.org/newshour/economy/u-s-employers-pulled-back-on-hiring-in-june Email Facebook Twitter LinkedIn Pinterest Tumblr Share on Facebook Share on Twitter U.S. employers pulled back on hiring in June Economy Jul 2, 2026 10:14 AM EDT WASHINGTON (AP) — U.S. employers slowed hiring last month and added only 57,000 jobs, less than half the previous month's total and a sign companies still have a cautious economic outlook. The Labor Department said Thursday that the unemployment rate declined to a low 4.2% from 4.3% in May, though the decline mostly occurred because many people out of work gave up looking and were no longer counted as unemployed. The figures suggest businesses remain wary of the economy's health, with inflation at a three-year high and consumer confidence near post-pandemic lows. The job market has been stuck in a "low-hire, low-fire" rut in which the employed enjoy some job security while layoffs are low, but those out of work are struggling to get hired. Strong hiring in the spring raised hopes the economy was escaping that dynamic, but Thursday's report suggests it hasn't happened. Educate your inbox Subscribe to Here’s the Deal, our politics newsletter for analysis you won’t find anywhere else. Strong job gains that were initially reported in April and May were revised lower. Hiring in May was marked down to 129,000 from 172,000, while April's job gains are now 148,000, down from an initial estimate of 179,000. Restaurants, bars, and hotels cut 61,000 jobs, a sharp disappointment for those who expected the World Cup tournament that is taking place in multiple U.S. cities would lead to at least temporary job gains. Retailers also shed 7,500 jobs. Chad Moutray, chief economist at the National Restaurant Association, said member companies are seeing signs consumers are pulling back on eating out, particularly outside higher-income households. They are also seeing evidence of a "K-shaped" economy, with wealthier households pulling ahead of middle- and lower-income ones. "We continue to hear that a lot of Americans are struggling to make ends meet," he said. "If you're catering to the upper-end of the K, you're doing fine. If you're catering to the lower part of the K, you're seeing some challenges in the last couple of months." Many businesses may be wary of hiring as they navigate the implementation of artificial intelligence, but last month professional and business services, a category that includes architecture, engineering, and software developers — occupations expected to be vulnerable to AI — added 36,000 jobs. Healthcare, the economy's most consistent job creator, added nearly 47,000 positions. The economy is growing modestly despite ongoing challenges. It expanded at a 2.1% annual pace in the first three months of the year, though some forecasts expect it will slow in the April-June quarter. Ongoing jo