finance
U.S. Unemployment Rate Falls to 4.2% in June While Labor Force Shrinks and Payroll Growth Slows
The unemployment rate reached its lowest level in a year while labor force participation dropped to 61.5 percent, the lowest since March 2021. Nonfarm payrolls rose 57,000, missing expectations, with prior months revised lower.
Audio version
Tap play to generate a narrated version.
Developing·Limited corroboration so far. This page will refresh as more sources emerge.
The U.S. unemployment rate fell to 4.2 percent in June 2026, the lowest level in one year, Cnbc reported. The decline occurred alongside a sharp contraction in the labor force, which dropped by 720,000 people.
The labor force participation rate slid to 61.5 percent, the lowest since March 2021 and, excluding the Covid period, the lowest in 50 years. The number of people not in the labor force rose by 832,000.06 million.
Nonfarm payroll employment increased by 57,000 in June, below the 110,000 expected, Cnbc reported citing Reuters. April and May figures were revised downward by a combined 74,000. Household-survey employment fell by 507,000.
The employment-to-population ratio declined to 59.6 percentage points to 83. Leisure and hospitality employment declined during the month.
Mike Reid, head of U.S. Dan North, senior economist for North America at Allianz, noted the participation rate showed a big leg down in one month.
Heather Long, chief economist at Navy Federal Credit Union, wrote that 720,000 people stopped looking for work entirely.
