July 2025: What’s Really Happening in the Job Market
The July jobs report offers a sobering view of a labor market that is cooling more quickly than many expected. While the headlines point to modest job growth, the underlying numbers—and the revisions to earlier months—reveal a job market that is losing momentum. For mid- and late-career professionals, this creates both new challenges and important opportunities.
A Weaker Picture Beneath the Surface
Employers added 73,000 jobs in July, a number that by itself would suggest slow but steady growth. But revisions to May and June data tell a different story: what were initially reported as gains of around 144,000 and 147,000 jobs, respectively, have now been cut to just 19,000 and 14,000. Those changes pull the three-month average down to roughly 35,000 jobs per month—a dramatic shift from the ~150,000 monthly average before the revisions.
Unemployment edged up to 4.2%, and new unemployment claims are starting to rise. Worker mobility is also slowing, as fewer people feel confident enough to leave their current jobs, and wage growth—especially for lower-income workers—is decelerating.
Meanwhile, layoffs spiked. Employers announced 62,000 job cuts in July, according to Challenger, Gray & Christmas, a 140% increase compared to last year.
Worker Confidence Is Near Record Lows
The hard numbers tell one story, but how workers are experiencing the job market tells another. LinkedIn’s Workers Confidence survey shows confidence has slipped to levels not seen in years:
Overall workforce confidence dropped to +23 in June 2025, lower than pandemic-era levels.
Job seeker confidence in July hit just +5, barely above an all-time low.
A year ago, confidence levels were much higher: +16 for job seekers and +54 for employed professionals.
What’s driving this erosion? Respondents cited the increasing role of Artificial Intelligence (AI), economic uncertainty, and the decline of traditional career paths as major concerns.
Generational differences are also stark. Millennials and Gen Z reported confidence levels of just +19, while Baby Boomers expressed more resilience at +28. The divide suggests younger professionals—still establishing themselves—feel more vulnerable to automation and shifting career models.
Hiring activity remains muted. Despite a slight rebound in May, national hiring rates are still well below pre-pandemic levels. A few sectors—such as farming, ranching, forestry, and education—have seen modest hiring gains, but overall momentum is subdued.
Meanwhile, workforce behaviors are shifting. The gig economy continues to expand, as more professionals seek flexibility and autonomy through freelance and contract work. And while remote work has declined from its 2020 peak, hybrid work is steadily rising, reflecting employers’ search for middle ground between flexibility and in-person collaboration.
Together, the data and sentiment point to a job market that is not only weaker on paper but also feels tougher for professionals across generations.
What the Experts Are Saying
Economists are noting the same trend lines:
“The job market continues to soften… those who lose jobs or new entrants are having quite a tough time finding new positions.” — Mike Fratantoni, Mortgage Bankers Association
“Payroll employment growth has stalled, and downward revisions confirm weakening momentum beneath the surface.” — Mark Zandi, Moody’s Analytics
“Signs of fragility and reduced dynamism… risk of deterioration rising.” — Fed Governor Michelle Bowman
Taken together, their message is clear: this is not a collapsing labor market, but it is one where job searches are stretching out, opportunities are harder to land, and confidence is slipping.
Where the Jobs Are (and Aren’t)
Not all industries are moving in the same direction. Some are still adding jobs at a healthy pace, while others are pulling back or shedding workers outright.
Growth areas include:
Health care and social assistance (+91K in July, with consistent strength all year)
Finance and insurance (+14K, continuing steady gains in 2025)
Transportation and warehousing (+3.6K, reflecting a gradual rebound in logistics)
By contrast, cuts are hitting:
Professional and business services (–14K, reversing earlier growth)
Manufacturing, particularly nondurable goods (–11K)
The federal government (–10K in July, down 84K since January)
Job openings also tell a mixed story. Retail (+190K openings) and professional services (+156K) remain strong, while accommodation and food services (–308K) and health care (–244K) showed notable pullbacks.
Layoffs Are Targeted, Not Widespread
The jump in announced cuts reflects targeted contractions rather than a broad wave of layoffs. Tech firms, for example, have cut nearly 89,000 jobs in 2025, up 36% from last year. Federal workforce reductions—especially among contractors and probationary employees—are also contributing to the totals.
The roles most at risk?
Sales and marketing teams at large tech firms consolidating functions
Entry-level tech positions, often those most exposed to automation
Federal contractors, who are typically the first cut in downsizing efforts
For now, it’s less about mass layoffs and more about specific sectors being reshaped.
Remote Work Holds Its Ground
Even as hiring slows, remote work remains a durable feature of the labor market. CPS data shows about 21.6% of U.S. employees were teleworking as of April 2025, with private-sector rates holding steady at 20.8%. Remote job postings rose 8% in Q2 2025, according to FlexJobs, and 40% of new postings now offer some form of flexibility (13% fully remote, 24% hybrid).
The roles most likely to remain remote include:
Computer & mathematical occupations (~70% remote or hybrid)
Business & financial operations (~59%)
Legal & professional/technical roles (~53%)
Creative and media roles (~47%)
What This Means for You
For job seekers—particularly experienced professionals—the data underscores the need to adjust expectations and strategies.
Competition is increasing. With fewer openings, more candidates are vying for the same roles.
Searches may take longer. Rising continuing claims suggest longer time-to-hire cycles.
Networking matters more than ever. With fewer posted opportunities, hidden jobs accessed through relationships are critical.
Flexibility is a strength. Considering contract, hybrid, or adjacent roles can help keep your momentum.
How to Adapt
To stay competitive, focus on what you can control:
Sharpen your pitch. Align your branding with employer needs and highlight your impact.
Target growth sectors. Health care, finance, and logistics are showing momentum.
Expand your reach. Go beyond job boards—network strategically to uncover hidden opportunities.
Stay informed. Follow industry trends so you can anticipate changes and pivot quickly.
Invest in skills. Bolster areas like data literacy, digital tools, or certifications that give you an edge.
Final Thought
The July jobs report shows a labor market that is losing steam, but far from collapsing. For experienced professionals, the key is to be proactive, flexible, and deliberate. The clearer you can be about your value—and the more intentional you are in building your network—the better your chances of landing the right role in a tougher market.
Feeling Uncertain About Your Next Step?
I’m Jeff Rothman. I help experienced professionals find purpose and direction during career transitions especially at mid-career and beyond.
