American Companies Hit the Brakes on Hiring

Companies across the economy have plans to trim head count in the coming months

- Konrad Putzier & Lauren Weber

U.S. job growth looked solid in June, but the headline number hides a stark reality: Many private employers aren't hiring anymore. Weighed down by high interest rates, a federal crackdown on immigration and uncertainty over tariffs, more companies are deciding they are better off with a smaller head count.

Last month, businesses added 74,000 new jobs, an anemic number compared with previous months. Private-sector job growth fell to the lowest level since October 2024. Of the 147,000 total new jobs added in June, nearly half were in government, bolstered by a jump in state and local government jobs.

On top of that, more than half of private industries cut jobs in June, Labor Department data indicates—only the third time this has happened since April 2020. For most of the post-pandemic period, the majority of industries were adding jobs.

Many employers say there are just too many question marks hanging over the economy to expand head count right now. Warby Parker this spring told investors it would slow the pace of its hiring and reduce other expenses to help its profitability.

American Vinegar Works, a six-year-old specialty-food company based in Worcester, Mass., is holding off plans to bring on an additional employee to fill orders, as well as sales staff, because of concerns about the economy.

"I just don't know what's happening," said the founder, Rodrigo Vargas. "It makes me cautious."

The company, which has two full-time and three part-time employees, is delaying planned investments in new equipment for a product launch. "Anything that is longer term, that would provide results in five or six months, we are being cautious about it," he said.