July's job growth significantly weakened to 73,000, with May and June gains erased, pushing the unemployment rate to 4.2%. Trump's tariffs are cited as a major factor, impacting manufacturing with an 11,000 job loss in the sector. Factory managers report tariff uncertainty is depressing orders and causing unexpected costs. The federal government also shed 12,000 jobs. While wages continue to rise, the labor market's weakness is expected to increase pressure on the Federal Reserve to lower interest rates.

Prepared by Christopher Adams and reviewed by editorial team.