McKenna Melby of the North Dakota State College of Science speaks with a job fair attendee in Fargo, North Dakota, on July 28, 2026. Melby was recruiting potential students for the certified nursing assistant program.(Photo by Jeff Beach/North Dakota Monitor)
In July, U.S. employers cut 23,000 jobs, while previous months’ employment figures were revised down by 103,000, according to new Bureau of Labor Statistics data. The labor market is feeling the strain of ongoing labor shortages. Mark Zandi, chief economist at Moody’s Analytics, highlighted the concerning state of the economy, noting, “Job growth is at a virtual standstill.”
Inflation impacts are evident as general merchandise retailing lost 21,000 jobs and gas stations reduced their workforce by 5,000. The finance sector also saw a decline of 14,000 jobs, marking a total loss of 121,000 since May 2025. In contrast, health care jobs increased by 22,000, though this is below the yearly average of 36,000.
The government revised May and June job numbers, reducing May’s total by 66,000 and June’s by 37,000, despite the World Cup’s positive impact on employment. Revised figures show 63,000 jobs added in May and 20,000 in June.
Small businesses reported a “substantial tightening of the labor market” in July, according to the NFIB report. Labor supply and quality concerns were cited by 27% of members, a jump from 19% in June. Health insurance costs are a significant concern, especially in Texas, where Medicaid has not expanded under the Affordable Care Act. Around 15% of Texas NFIB members identified health insurance as their top problem, compared to 10% nationally.
“I have yet to have a conversation with anyone who doesn’t think this is a problem and in most cases it’s their biggest problem,” NFIB State Director Jeff Burdett said. Many small businesses cannot afford health insurance, causing potential employees to seek larger companies.
The ADP employment report also indicates a labor market tightening, with job changers experiencing the fastest pay growth in a year. “Job changers are highly sensitive to real-time economic conditions,” stated Nela Richardson, ADP’s chief economist, noting supply constraints in parts of the labor market.
