US nonfarm payrolls rose by 147,000 in June, in line with the average monthly gain seen over the past 12 months.
Gains were concentrated in health care and state government, while federal employment continued to decline in part due to measures taken by the Department of Government Efficiency (DOGE).
Meanwhile, the unemployment rate changed little, falling by 0.1 percentage point to 4.1%, and has remained between 4.0%-4.2% for just over a year.
Looking ahead, we expect that tariffs will have a negative impact on US employment in the coming months, as firms seek to protect profit margins by cutting labour costs. In our view, this loosening of the labour market will prompt the Federal Reserve to cut rates twice more this year.
