US Services Rebound, But Jobs Shrink Again

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US Services Rebound, But Jobs Shrink Again
July 3rd, 2025

The U.S. services sector showed minimal growth during June according to Institute for Supply Management (ISM) data while labor performance remained weak. The non-manufacturing PMI indicator increased to 50.8 during June after reaching 49.9 in May which shows a small growth in the sector that drives more than two-thirds of the economy.

The employment index decreased to 47.2 which marked the third consecutive month of decline in six months. The business environment remains uncertain because companies delay hiring staff even though new orders show improvement before the August 15 expiration of the 90-day U.S.-China tariff pause.

The ISM reported that firms continue to exercise caution when deciding to hire new staff despite their improving demand levels.

The survey's new orders index increased to 51.3 from 46.4 in May which indicates a positive trend in demand. Businesses show no signs of expanding their workforce after facing difficulties in recruiting staff during the post-pandemic period.

The input prices index decreased to 67.5 from 68.7 in May but remained at a high level. The economic data indicate that the economy faces potential risks of stagflation.

The economy shows signs of stability in demand but ongoing inflation combined with cautious hiring practices indicate weak fundamental conditions.

Dominic Maley

Dominic Maley is an American journalist recognized for his sharp and insightful reporting on social and political issues. His work is known for its depth, integrity, and the ability to highlight critical societal concerns.

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