U.S. sheds 23,000 jobs in July as UK hiring picks up in tech and law

The U.S. labor market contracted in July 2026, shedding 23,000 jobs in the first negative month since February, according to new employment data released Friday. The weakness was compounded by substantial revisions to prior reports that wiped more than 100,000 payrolls from May and June, reducing the three-month average of monthly job gains from approximately 111,000 to just 20,000.

Private employers added only 44,000 jobs in July, down sharply from 95,000 in June and marking the weakest monthly gain since January, according to ADP data. About 50,000 of the month's job losses came from local government education, a sector that experiences seasonal swings around the school calendar.

Construction added just 1,000 jobs in July, though pay for construction workers who changed jobs reached record highs, driven by strong demand from AI-related data center construction projects.

A bright spot in wages

Despite the job losses, wage growth accelerated for workers willing to switch employers. Annual pay growth for those who changed jobs hit 7% in July, the fastest pace since August 2025, while workers who remained in their current roles saw pay growth hold steady at 4.4%.

UK market shows signs of life

Across the Atlantic, the UK employment market displayed more optimism. Robert Walters, a recruitment firm focused on mid to senior professional services, reported a 9% rise in net fee income in the first half of 2026. The company noted an upturn in legal, technology and accounting recruitment, sectors where candidate confidence appears to be recovering. Consumer-led industries such as retail and hospitality continued to struggle with recruitment.

Internship take-up lags in India

India's Prime Minister Internship Scheme (PMIS) offered around 122,000 internship opportunities through 340 companies across 31 sectors as of mid-July 2026, but uptake remained slow. Only 10,195 candidates had physically joined these internships by that date.

The rise of late-night AI interviews

As recruitment increasingly relies on automated video interviews and AI, a new trend has emerged: candidates are interviewing at unconventional hours. According to Ribbon, a voice-AI recruitment software company, 24% of its AI interviews take place between 10 pm and 2 am local time across more than 500 client companies. For manufacturing clients specifically, that figure jumped to 35%. Greenhouse reports that roughly 15 to 20% of candidates interviewed by its voice agent schedule interviews at night, reflecting the flexibility—and sometimes the necessity—of job hunting in an AI-driven recruitment landscape.