US Employment and Job Creation Over the Past 12 Months
Main Takeaway: US employment dramatically slowed from robust growth in late 2024 to weak, uneven gains and sectoral declines by late summer 2025. Healthcare led sector growth, while manufacturing and government suffered notable losses. Unemployment ticked higher and workforce participation slipped, raising concerns about the durability of the economic expansion.
Overall Employment Performance: A Tale of Two Periods
The US economy added approximately 1.35 million jobs from September 2024 through August 2025, but this number conceals a stark contrast between two periods. The final months of 2024 saw monthly job creation near 187,250 jobs, dropping to just 74,750 per month on average in 2025—a steep 60% slowdown. Notably, June 2025 registered the first monthly job loss since the pandemic.
Unemployment Rate Trajectory and Labor Market Stress
Unemployment rose from 4.1% to 4.3% during the period, reaching a four-year high. The share of Americans long-term unemployed increased, labor force participation fell 0.4 percentage points to 62.3%, and hundreds of thousands more wanted jobs but were not actively searching, highlighting growing stress beneath headline rates.
Sectoral Analysis: Healthcare Leads, Manufacturing Struggles
Healthcare and Social Services
Healthcare was the standout growth engine, adding 31,000 jobs in August 2025 and remaining the most reliable source of new jobs. Growth also came from social assistance (+16,000) and select sub-industries like ambulatory health and hospitals. The Bureau of Labor Statistics forecasts healthcare and social assistance as the fastest-growing industry sector through 2034.
Manufacturing
Manufacturing continued to shed jobs (down 78,000 over the year; -12,000 in August), reflecting broad pressures from high interest rates, weak demand, and supply-chain disruptions. Job openings remained high but stemmed from labor shortages and skills mismatches.
Government Employment
Federal employment saw dramatic declines (down 97,000 since a January peak), while state and local government remained relatively steady but contributed little to overall growth.
Professional & Business Services
This sector remained weak, losing 17,000 jobs in August. Temporary help services—often a bellwether—continually reflected low confidence in expansion.
Leisure & Hospitality
Volatile recovery left leisure and hospitality below normal; the sector added 28,000 jobs in August but average monthly gains in 2024 were halved compared to 2023.
Construction
Construction employment was resilient but growth slowed sharply. The sector lost 7,000 jobs in August, as activity shifted toward infrastructure projects and contractors focused on retention.
Wage Growth and Economic Implications
Wages rose 3.7% year over year in August 2025, a moderating pace that helped ease inflationary pressures. The average workweek remained steady at 34.2 hours.
Regional and Demographic Disparities
Black or African American unemployment rose to 7.5% (from 6.1%), while Hispanic or Latino unemployment reached 5.3%—both outpacing the broader labor market and underscoring equity challenges.
Policy and Federal Reserve Implications
Labor market weakness motivated the Federal Reserve to consider interest rate cuts. Economists largely attributed the slowdown to earlier rate hikes intended to cool inflation, but the rapid deceleration sparked debate about overcorrection risks and long-term job growth prospects.
Looking Forward
The employment landscape is in transition: robust post-pandemic recovery gave way to slower, uneven growth. Healthcare provides a bright spot, while manufacturing, government, and some services are in retreat. Future performance will depend on rates, infrastructure projects, and renewed business confidence.
Monthly Job Creation Table
| Month | Jobs Added | Unemployment Rate | Notes |
|---|---|---|---|
| Sep 2024 | 254,000 | 4.1% | Strong gains, exceeded expectations |
| Oct 2024 | 12,000 | 4.1% | Hurricane/strike disruptions |
| Nov 2024 | 227,000 | 4.2% | Recovery from October disruptions |
| Dec 2024 | 256,000 | 4.2% | Highest gain since March 2024 |
| Jan 2025 | 111,000 | 4.2% | Post-holiday slowdown |
| Feb 2025 | 102,000 | 4.2% | Continued slowdown |
| Mar 2025 | 120,000 | 4.2% | Modest recovery |
| Apr 2025 | 158,000 | 4.2% | Improvement continues |
| May 2025 | 19,000 | 4.2% | Sharp decline, nearly zero growth |
| Jun 2025 | -13,000 | 4.1% | First negative month since pandemic |
| Jul 2025 | 79,000 | 4.2% | Slight recovery |
| Aug 2025 | 22,000 | 4.3% | Weak growth continues |
August 2025 Sectoral Performance Table
| Sector | Jobs Change | YOY Trend |
|---|---|---|
| Healthcare | +31,000 | Consistent growth leader |
| Social Assistance | +16,000 | Steady positive growth |
| Leisure & Hospitality | +28,000 | Recovery from 2024 lows |
| Retail Trade | +10,500 | Volatile but positive |
| Other Services | +12,000 | Mixed performance |
| Transportation & Warehousing | +3,600 | Moderate growth |
| Manufacturing | -12,000 | Down 78k over year |
| Wholesale Trade | -11,700 | Declining since May |
| Construction | -7,000 | Slowing growth |
| Mining & Logging | -6,000 | Little change over year |
| Information | -5,000 | Consistent losses |
| Financial Activities | -3,000 | Mixed performance |
| Professional & Business Services | -17,000 | Continued weakness |
| Federal Government | -15,000 | Major decline from Jan peak |
References
- September 2024 Jobs Report | J.P. Morgan
- What to know about the August Jobs Report
- Employment by industry, monthly changes - BLS
- US unemployment rate near 4-year high
- The Employment Situation - August 2025 - BLS
- Employment Situation Summary - BLS
- Manufacturing employment decline
- Employment by major industry sector
- Employment Projections - 2024-2034 - BLS
- Construction: NAICS 23 : BLS
- Monthly unemployment rate U.S. 2025 - Statista
- U.S. Construction Industry Data
- Unemployment Rate | FRED
- 2025 Manufacturing Industry Outlook | Deloitte
- Total restaurant industry jobs
- Leisure and Hospitality : BLS