Economy lost 23,000 jobs in July, falling short of expectations

The economy lost 23,000 payroll jobs in July, the Bureau of Labor Statistics reported Friday, as businesses contended with the ongoing energy supply shock from the war with Iran.Forecasters had expected payroll job growth to be 88,000, so the report was a pretty big miss. Friday’s report suggests more trouble ahead for President Donald Trump, who has been weighed down by historically low consumer sentiment and voter frustration over too-high inflation.Much of the recent surge in prices is a result of higher energy prices stemming from the war in Iran, which sent gasoline prices much higher, dragging up overall headline inflation.Months later, the conflict is still not fully resolved and has been characterized by start-and-stop negotiations and many open questions. The halt of oil tankers through the Strait of Hormuz at various times has driven major increases in the price of oil.The July jobs report adds to Trump’s list of economic concerns. A slowdown in the labor market would compound the problems facing Republicans heading into the midterm elections. The Federal Reserve has also received outsize attention given this year’s surge in inflation following the start of the Iran war.The Fed, under new Chairman Kevin Warsh, opted to hold interest rates steady at its meeting last week, but most investors anticipate that the central bank will move to raise interest rates at least once, maybe multiple times, before the end of the year.