August 2026 Talent Market Insights
The latest U.S. Bureau of Labor Statistics (BLS) Employment Situation report shows hiring remained limited in July. The number of jobs declined by 23,000, while unemployment remained relatively stable at 4.1%.
Revisions to previous months also showed that hiring had been slower than initially reported. May and June job gains were revised downward by a combined 103,000 jobs. At the same time, labor force participation remained at 61.4%.
For HR and operations leaders, the report points to a labor market where hiring activity has slowed, but the available labor pool has not meaningfully expanded.
Key Takeaways from the July 2026 Jobs Report
The number of jobs declined by 23,000 in July
Unemployment remained relatively stable at 4.1%
Labor force participation held at 61.4%
Average hourly earnings increased 3.2% over the past 12 months
May and June job gains were revised downward by a combined 103,000 jobs
Job Growth by Industry
Employment changed little across most major industries in July. Job losses were concentrated in a few areas, while health care continued to add jobs.
Industries adding jobs:
Health care: +22,000
Industries losing jobs:
Local government education: -50,000
Retail trade: -19,000
Financial activities: -14,000
Employment showed little change in many other major industries, including manufacturing, transportation and warehousing, construction, professional and business services, wholesale trade, and leisure and hospitality.
Unemployment and Labor Supply
The unemployment rate was 4.1% in July, and 6.9 million people were unemployed. Both measures changed little during the month.
Labor force participation also changed little at 61.4% in July but remains 0.7 percentage point below its January level.
Additional labor supply indicators include:
Long-term unemployed: 1.8 million
People working part time for economic reasons: 4.8 million
People outside the labor force who wanted a job: 5.9 million
Marginally attached to the labor force: 1.8 million
Discouraged workers: 476,000
Wage Growth and Hours Worked
Wages and hours showed limited movement in July.
Average hourly earnings increased 3.2% over the past 12 months
The average workweek remained at 34.3 hours
The manufacturing workweek remained at 40.4 hours
Manufacturing overtime edged down by 0.1 hour to 3.1 hours
What Employers Can Do
Focus Hiring on Critical Roles
With hiring activity slowing and employment showing little change across many major industries, employers can be more targeted about where they focus recruiting resources.
Review upcoming production needs, seasonal demand, expected turnover, and open positions. Prioritize the roles that are most important to maintain operations and meet business needs.
Keep Candidate Pipelines Active
Slower hiring does not necessarily mean a larger pool of available workers. Labor force participation held at 61.4% in July and remains below its January level.
Continue building relationships with qualified candidates, especially for positions that are consistently difficult to fill. Maintaining an active pipeline can help reduce delays when vacancies arise or hiring needs change.
Watch Your Local Market
National labor market data provides useful context, but hiring conditions can vary significantly by location, industry, and occupation.
Track local labor availability and wage trends for the positions you need. Understanding what is happening in your market can help you make more informed decisions about recruiting, compensation, and staffing plans.
Want to Learn More About Hiring Trends in Your Local Market?
At Verstela, we help employers turn labor market data into practical workforce decisions.
Whether you're planning your workforce, hiring for critical roles, or evaluating your staffing strategy, our team can help you better understand the hiring conditions affecting your business.