Overall employment fell by 23,000 in July due to a sizable reduction in educational services by local governments. The private sector squeaked out more jobs. Federal government jobs, after a big reduction in the past year, are stabilizing. Year-to-date is showing a positive 426,000 more jobs.

The 3.1% wage growth would be the slowest gain in 5 years. Consumer price inflation is running faster, so wage gains are wiped out at gas stations and grocery stores. The wage gain is still outpacing home price growth, as has been the case for the past 18 months. The bond market is liking the lower wage pressure, and mortgage rates look to take a decimal-point dip.

What is concerning is the tight labor market despite the weak job additions. The unemployment rate is super low at 4.1% and “help wanted” signs abound. With the southern border crossings effectively shut down and legal immigration at near historic lows, more Americans need to step into the job market. Yet labor force participation has been falling and has hit a new low in modern times (aside from the few months during the COVID lockdown). Sadly, too many Americans are not even searching for a job.

Line chart showing total U.S. payroll employment from 2000 to July 2026. Payroll jobs rose from about 131 million in 2000 to nearly 159 million in 2026, with notable declines during the 2008 housing crash and the 2020 pandemic before reaching a record high by July 2026. Source: BLS.
Bar chart showing monthly U.S. net payroll job gains from January 2021 through July 2026. Job growth was strongest in 2021 and 2022, moderated through 2023 and 2024, and turned negative in July 2026 with a loss of 23,000 jobs. Despite the July decline, payroll employment is up 426,000 jobs year-to-date in 2026. Source: BLS.
Line chart showing U.S. federal government employment, excluding Census and Postal Service workers, from 2000 to July 2026. Employment rose from about 1.8 million workers in 2000 to a peak near 2.4 million in 2025, then declined sharply in 2026 before stabilizing at about 2.1 million workers.
Bar chart showing estimated net unauthorized immigration to the United States from 2015 to 2025, measured in thousands. Net unauthorized immigration rose steadily after 2021, peaking at more than 300,000 per month in 2023 and 2024, before declining sharply and turning negative in 2025. Source: Dallas Federal Reserve.
Line chart showing the U.S. unemployment rate from 2015 through July 2026. The rate declined from about 5.7% in 2015 to 3.5% before spiking to nearly 15% during the 2020 pandemic. Unemployment then fell steadily and remained historically low at 4.1% in July 2026. Source: BLS.
Line chart showing the U.S. labor force participation rate from 2015 through July 2026. Participation remained near 63% before dropping sharply during the 2020 pandemic, recovering modestly through 2023 and 2024, and then declining again to about 61.4% in July 2026, the lowest level since the pandemic recovery period. Source: BLS.
Line chart comparing U.S. wage growth (blue) and home price growth (red) from 2015 through July 2026. Home prices increased much faster than wages during 2021 and 2022, peaking near 25% annual growth. Since early 2025, wage growth has exceeded home price growth for 18 consecutive months, with wages rising about 3% annually and home prices growing around 1% to 2%. Source: BLS.
U.S. map showing one-year payroll employment growth by state from June 2025 to June 2026. Most states recorded job gains, led by Nevada (2.3%), Minnesota (1.5%), Texas (1.2%), North Carolina (1.2%), and Alaska (1.2%). Job losses occurred in several states, including the District of Columbia (-4.8%), Maryland (-0.7%), Iowa (-0.6%), Oregon (-0.9%), and Montana (-1.0%). Source: NAR analysis of BLS data.
U.S. map showing payroll employment growth by state from March 2020 to June 2026. Idaho (14.6%), Utah (13.9%), Nevada (12.8%), Texas (12.1%), Florida (11.2%), North Carolina (10.7%), and Arizona (10.2%) posted some of the strongest job gains. Most states recorded employment growth, while the District of Columbia (-10.0%) and Hawaii (-2.0%) remained below pre-pandemic employment levels. Source: NAR analysis of BLS data.