U.S. job growth slows in June as unemployment rate falls to 4.2%

U.S. hiring slowed sharply in June, with nonfarm payrolls rising by 57,000, according to the Bureau of Labor Statistics. That was below both May’s revised gain of 129,000 and economists’ expectations. The unemployment rate edged down to 4.2%, but the decline was tied in part to a smaller labor force participation rate, which fell to 61.5%, its lowest level since March 2021. Household employment also weakened, with 507,000 fewer people reporting work. Job gains were concentrated in professional and business services, social assistance, and health care, while leisure and hospitality lost jobs. Markets reacted by trimming expectations for a nearterm Federal Reserve rate hike, and Treasury yields moved lower.