...LOCAL GOVERNMENT EDUCATION DRAG
Local government education employment dropped 49,600 last month, the most since October 2021, and contributing to a 53,000 decrease in overall government payrolls. Excluding government, private payrolls increased by 30,000, matching June's gain.
Private job growth has averaged 72,000 per month this year, and some economists argued that this was a better reflection of the labor market. They expected the slump in local government to reverse in August.
Leisure and hospitality employment decreased by 40,000, losing jobs for a second straight month. Payrolls at restaurants and bars dropped by 26,100. The retail trade sector lost 19,400 jobs, the bulk of them at warehouse clubs, supercenters and other general merchandise stores.
These two sectors, which have become volatile in recent months, weighed down overall payrolls by 59,400 jobs.
Employment in financial activities fell further, shedding 14,000 jobs. Financial activities jobs are down by 121,000 since peaking in May 2025. Healthcare payrolls increased 22,000, but well below the monthly average of 36,000 over the past year.
There were 22,000 construction jobs added, while manufacturing employment rose 5,000. A total of 31,000 factory jobs have been added this year, likely driven by an artificial intelligence buildout. But the share of manufacturing industries reporting employment gains dropped to 50.0% from 56.9% in June. ...
