Macro● Neutral
US Jobs Miss in July as Leisure, Hospitality Slide
The US unexpectedly lost 23,000 jobs in July, with leisure and hospitality shedding 59,400 jobs over two months. Inflation and price volatility are weighing on consumer spending, economists say. July CPI due next week.
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The US labor market posted its first monthly job loss since February, shedding 23,000 positions in July, as two consumer-facing industries that had been driving growth reversed course. Leisure and hospitality and retail together lost 59,400 jobs, following a 43,000 decline in leisure and hospitality in June and a 3,700 drop in retail.
The weakness in services that had been the engine of the post-pandemic recovery is fading, economists said. Employment in food services and drinking places, as well as arts and entertainment, contributed to the sector's second straight monthly decline. Accommodation employment ticked back up after a drop in June.
One culprit is inflation weighing on wallets. ZipRecruiter economist Nicole Bachaud said consumers are responding to price volatility by cutting discretionary spending, including dining out, which results in employers slowing their hiring. "The price of going out in LA has become very, very, very high for a one-and-a-half-hour dinner," said Ariel Kashfian, a diner. "You get more bang for your buck having people over at your house."