The U.S. economy demonstrated continued resilience in June 2025, with nonfarm payrolls increasing by 147,000, surpassing the anticipated 110,000 and marking a slight improvement from May’s revised gain of 144,000. This uptick led to a decrease in the unemployment rate to 4.1%, down from 4.2% in May, as reported by the U.S. Bureau of Labor Statistics.
The majority of job growth was concentrated in state and local government sectors, particularly in education, which added 40,000 positions. Healthcare also saw a significant increase, contributing 39,000 jobs. Conversely, the federal government experienced a decline, losing 7,000 jobs in June and a total of 69,000 since January.
Despite the overall positive employment figures, there were some concerning trends. The number of long-term unemployed individuals rose by 190,000 to 1.6 million, accounting for 23.3% of all unemployed persons. Additionally, the number of discouraged workers—those who have stopped seeking employment due to perceived lack of opportunities—increased by 256,000 to 637,000.
Wages saw a modest increase, with average hourly earnings rising by 0.2% from May and 3.7% year-over-year. The labor force participation rate remained steady at 62.3%, and the employment-population ratio held at 59.7%.
This robust job growth has led to speculation about the Federal Reserve’s next move on interest rates. While some analysts had anticipated a rate cut in July due to economic uncertainties, the strong employment data may prompt the Fed to maintain its current policy stance.
