U.S. Job Growth Slows in June as Labor Market Gives Fed Room to Stay Focused on Inflation

U.S. employers added 57,000 jobs in June, while the unemployment rate edged down to 4.2% from 4.3% in May, according to the U.S. Bureau of Labor Statistics.

The report also included sizable downward revisions to prior months. April payroll growth was revised lower to 148,000 from 179,000, while May payrolls were cut to 129,000 from 172,000. Combined, the revisions reduced employment gains by 74,000 over the two-month period.

Despite the moderation, the labor market has remained resilient. Nonfarm payrolls have increased by an average of 111,000 jobs over the past three months, an improvement from the declines seen late last year, although hiring has slowed from earlier in 2026.

Labor force participation fell 0.3 percentage point to 61.5% in June, while the employment-population ratio edged down to 59.0%, suggesting some workers stepped out of the labor force during the month.

The latest employment data are unlikely to alter the Federal Reserve’s near-term policy stance. Since taking over as Fed chairman, Kevin Warsh has emphasized restoring price stability after inflation remained above the central bank’s 2% target for more than five years.

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About Joe Palmisano

Joe Palmisano is editorial director of Connect Money, where he oversees daily coverage of alternative assets, direct investments, financial advisory and the economy. He brings three decades of experience as a financial journalist, analyst and portfolio manager. Before joining Connect Money, Palmisano wrote for The Wall Street Journal, covering foreign exchange, global fixed-income and equity markets. He later served as a senior research analyst and portfolio manager, producing market analysis and managing foreign exchange and U.S. equity portfolios for FX Concepts. His work has also appeared in SFO Magazine and CMT Association publications. Palmisano earned a bachelor’s degree in finance from The American University and holds the Chartered Market Technician (CMT) designation and is a member of the CFA Institute.

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