The latest U.S. employment report has drawn concerning reactions from leading economists, many of whom warn that the labor market has slipped into a jobs recession.

Only 22,000 jobs were added in August, far below expectations of 76,500. June marked the first net decline in nearly four years, with 13,000 jobs lost. 

Meanwhile, the unemployment rate rose to 4.3%, its highest level since 2021, indicating mounting economic weakness.

Mark Zandi

Among the economists, Mark Zandi of Moody’s Analytics stressed that payroll employment is already in recession territory. He noted that July and August posted modest gains, likely to be revised down, with losses concentrated in manufacturing, mining, construction, and the government sector.

Only healthcare and hospitality have provided some offset. Zandi, long bearish on the economy, has argued that several sectors and states are already in recession.

David Rosenberg

David Rosenberg of Rosenberg Research highlighted distortions in the headline numbers, pointing out that the Bureau of Labor Statistics’ Birth-Death model added 96,000 jobs. 

Without this adjustment, payrolls fell by 74,000 in August. He warned that, by this measure, payrolls have declined for four consecutive months, a pattern last seen during the sluggish recovery from the Great Recession.

Peter Schiff 

Lastly, Peter Schiff of Euro Pacific Asset Management offered a more pessimistic view, arguing that the official unemployment rate understates the downturn. 

He cited broader measures showing joblessness at 8.1%, and by stricter estimates, above 10%. Schiff compared current labor conditions to the 2008 financial crisis and the 2020 pandemic lockdowns, warning that revisions point to a steady erosion of job growth.

Overall, economists caution that employment weakness could soon spill into the wider economy.

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