The U.S. labor market showed further signs of fatigue in July, with health care emerging as the clear—and almost solitary—engine of job growth, according to fresh data from the Bureau of Labor Statistics released Friday.
Health care and social assistance added 73,300 jobs in July, by far the largest gain of any sector. If private education is grouped in, as some economists prefer, the tally rises to nearly 79,000. That means virtually all of last month’s 73,000 nonfarm payroll gains came from health-related fields. Without them, the jobs report would have tipped into negative territory.
“It’s almost a no-hire, no-fire job market,” said Mark Hamrick, senior economic analyst at Bankrate. “Health care and social assistance are doing the heavy lifting, while other areas look frozen.”
Adding to concerns, previous months were sharply revised lower: June’s initially strong report was cut to just 14,000 jobs, down from 147,000, while May slid to 19,000 from 144,000. Together, those revisions signal a much weaker hiring trend than originally thought.
Still, some pockets of strength remain. Within health care, ambulatory services added 34,000 jobs and hospitals gained 16,000. Social assistance—particularly in individual and family services—rose by 21,000. Retail trade ranked a distant second with 15,700 jobs, followed closely by financial activities at 15,000.
Most other industries, however, contracted. Professional and business services shed 14,000 jobs, government payrolls fell by 10,000, manufacturing lost 11,000, and wholesale trade slipped by nearly 8,000.
“This report absolutely raises a red flag,” Hamrick warned. With another jobs report due before the Federal Reserve’s September policy meeting, economists say all eyes are now on whether the latest slowdown proves temporary—or signals a deeper cooling in the U.S. economy.
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