Key Points
June growth in state and local government employment masked a strong deceleration in the pace of private sector job creation.
- Private sector nonfarm employment grew by 74K, down from 137K in May - the smallest increase since October 2024.
- Reductions in federal employment weighed on total job growth for the 5th consecutive month.
The labor force participation rate fell to its lowest level since 2022.
- While participation has fallen from post-pandemic peaks, it remains elevated relative to the Congressional Budget Office’s January 2020 projections.
- Labor force participation is expected to decline over time as the US population ages.
