The recent US job report raises serious concerns as the data showed significant downward revisions and a drop in job growth.
Job Growth Plummets in July
According to the US jobs data, the economy added only 73,000 jobs in July, significantly below the estimate of 110,000. Additionally, past months were heavily revised:
* June: From 147K to 14K * May: From 120K to 19K
This marks a total loss of 258,000 jobs, which exceeds the population of Scottsdale, Arizona.
Unemployment Rate Rises to 4.2%
The unemployment rate climbed from 4.1% to 4.2%, matching forecasts but indicating economic weakness. More individuals are out of work, and this trend may continue if job creation remains low.
Fed Rate Cut Possibilities in September
With the labor market weakening, the rising unemployment rate may push the Federal Reserve to consider a rate cut. However, high inflation and rising wages may compel the Fed to proceed cautiously and refrain from making abrupt changes.
The US job data raises alarming questions about the state of the labor market. If the Fed does not take measures to lower rates, it may lead to more serious economic repercussions.
