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FILE - A construction worker carries scaffolding parts on March 14, 2024, in Boston. On Friday, August 2, 2024, the U.S. government issues its July jobs report. (AP Photo/Michael Dwyer, File)

US hiring fell sharply in July, an unexpected setback for the economy stoking recession fears

The U.S. economy suffered an unexpected setback in July, as hiring fell sharply and the unemployment rate rose for the fourth straight month in a sign that higher interest rates may be taking a bigger toll on businesses and consumers

By PAUL WISEMAN and CHRISTOPHER RUGABER
Published - Aug 02, 2024, 04:53 PM ET
Last Updated - Aug 02, 2024, 04:53 PM EDT

WASHINGTON (AP) — The U.S. economy suffered an unexpected setback in July as hiring fell sharply and the unemployment rate rose for the fourth straight month with raised interest rates taking a toll on businesses and households.

Employers added just 114,000 jobs in July — 35% fewer than expected — and unemployment, now at 4.3%, is the highest since October 2021, the Labor Department reported Friday.

“Things are deteriorating quickly,’’ said Julia Pollak, chief economist at ZipRecruiter.

The sharp downturn in U.S. hiring shook financial markets around the world. The Dow Jones Industrial Average dropped 610 points, or 1.5%. The S&P 500 tumbled 1.8%.

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