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Job losses reveal a shakier labor market

August 7, 2026

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5 min read

A disappointing jobs report, a Fed in flux, and a teacher housing experiment

The July employment report landed with a thud this morning: 23,000 jobs lost, the unemployment rate ticking up to 4.1%, and prior months revised downward. "Wildly away from what was expected by Wall Street," said David Gura of Bloomberg. The numbers were so far from consensus that the conversation quickly turned to whether the labor market had been hiding its fragility all along—and what the Federal Reserve, laser-focused on inflation, might be missing.

The labor market is showing cracks

The headline job loss was bad enough, but the details underneath were worse. The labor force participation rate fell to roughly 61%, its lowest level in many decades. Wage growth slowed to its weakest pace in more than five years. And the pool of available workers is shrinking, partly because of the Trump administration's deportation campaign. "Immigration policy is a labor market story," said Kathleen Rampell of the Bulwark, noting that the economy has long depended on immigrant labor for certain roles, and those workers are simply not here anymore.

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What you'll learn

  • 1 (00:50) **Jobs Report Shocks with Net Losses** - The July employment report shows a net loss of 23,000 jobs and the unemployment rate rising to 4.1%, far below expectations.
  • 2 (02:31) **Economists Focus on Labor Force Dropouts and Long-Term Unemployment** - Catherine Rampell of the Bulwark warns that people are giving up on finding work, and a quarter of the unemployed have been jobless for 27 weeks or longer.
  • 3 (03:42) **Immigration Policy Reshapes Labor Demand** - The discussion returns to how reduced immigration may lower the number of jobs needed to keep unemployment low.
  • 4 (04:43) **The Fed Faces a New Labor Market Worry** - The panel considers whether the Fed, long focused on inflation, must now start worrying about maximum employment, the other half of its dual mandate.
  • 5 (06:59) **Fed Hawks Speak Out, Challenging the Chair's Silence** - David Gura reports that seven FOMC members have publicly signaled readiness to raise rates, filling a vacuum left by Chair Warsh's reticent press conference.
  • 6 (08:31) **Senate Bill Gives President Sweeping New Tariff Powers** - Catherine Rampell explains the "Lindsey Graham Russia Sanctions Act," which is nominally about Russia but vastly expands presidential authority to levy 100% tariffs on virtually any country.
  • 7 (10:36) **Sector-by-Sector Job Losses: Schools, Finance, and Hospitality** - Mitchell Hartman reports on the specific industries shedding jobs in July, starting with local government education, which lost nearly 50,000 positions.

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Guests on this episode

Mitchell Hartman

Show Notes

The July jobs report is out, and it’s a doozy: The U.S. labor market shed a net 23,000 jobs last month. Previous months, which saw moderate gains, were revised down. In this episode, which sectors cut the most roles, and what it all signals about the broader economy. Plus: Climbing car prices lock buyers in longer-term loans, communities combat a teacher shortage by building affordable housing, and we want to hear your stories about voluntarily leaving the workforce.


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