Non-farm payrolls are set to be released tonight! The impact of Trump's policies is showing, and the US job market may be in trouble.

With the trade and immigration policies of the Trump administration starting to take effect, forecasters predict that the US monthly employment report will show a slowdown in job growth, and the unemployment rate will rise to its highest level since 2021. It is reported that the US Department of Labor will release the June non-farm employment data at 20:30 on Thursday Beijing time, with the market expecting an increase of 106,000 jobs, the lowest increase in four months, compared to an increase of 139,000 jobs in May; the unemployment rate is expected to slightly increase to 4.3%. Thursday's non-farm data may lead Federal Reserve officials to delay a rate cut until September, as investors currently expect. However, if signs of accelerated economic deterioration emerge, the market will increase bets that the Fed will take action at the policy meeting scheduled for July 29-30. Nancy Vanden Houten, Chief US Economist at Oxford Economics, said: "The soft job market in June indicates future trends. We expect that employment growth will continue to weaken for the rest of the year due to tariffs and policy uncertainty." US hiring activity may slow down, and the unemployment rate may rise. Here are some key points to watch for in the non-farm report: Unemployment Rate: As the US federal trade and immigration policies undergo significant changes, economists are divided on whether the unemployment rate will rise in June and by how much. The unemployment rate may be the most significant indicator in this report affecting Fed policy. Most leading indicators indicate an increase in the unemployment rate. Previously released data showed that in the week ending June 14, the number of continuing unemployment benefit claims in the US rose to 1.974 million, the highest level since November 2021, reflecting a lengthening of the duration of unemployment for the unemployed. In May, the number of layoff notices submitted by companies under the Worker Adjustment and Retraining Notification Act soared by 61%, reaching the highest level since October 2020. The ADP non-farm employment number unexpectedly decreased by 33,000 in June, the first drop in over two years. The report also shows that the summer job market is off to a bad start for recent US college graduates who are already finding it increasingly difficult to find work. Economists at Citigroup believe this could be a contributing factor, and they expect the unemployment rate to rise to 4.4%. Andrew Hollenhorst, Chief US Economist at Citigroup, said: "Continued unemployment benefit claims are rising and may be underestimating the unemployment rate as those who have just entered the labor market are classified as unemployed but do not meet the conditions for receiving unemployment benefits." On the other hand, measures taken by the Trump administration to restrict immigration and increase deportations may help control the unemployment rate, as the slowdown in hiring speed also slows down the expansion of the labor force. The May report seemed to reflect this situation, with the unemployment rate staying at 4.2% and the labor participation rate falling to 62.4%. Economists at Morgan Stanley believe this trend will keep the unemployment rate unchanged in June. A team led by Michael Gapen, Chief US Economist at Morgan Stanley, said in a report: "Illegal immigrants and their families may choose to reduce their participation in the labor market to reduce exposure risk and decrease the likelihood of being deported." They added: "If the downward trend in labor participation rate continues into June, this will further support this view." They also added that if the participation rate had not dropped significantly, the unemployment rate should have been 4.7%. Industry Breakdown: In a Bloomberg survey, the range of forecasts for monthly hiring numbers is the narrowest since 2018, indicating a widespread consensus on the expected trend of slower hiring. Forecasters point out that investors should closely monitor the employment situation in various industries in June, including leisure and hospitality, healthcare, construction, manufacturing, and trade and transportation. In the May report, the leisure and hospitality industry stood out, reaching the highest number of hires in six months. Some economists, including Shruti Mishra of Bank of America and Joe Brusuelas of RSM US, suggest that this trend may reverse in June as consumer spending on travel and related services slows down. Economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics also note the risk of downward revisions to the April and May hiring data. They attribute this to the possibility of small businesses (which are in more difficult situations than other businesses) submitting survey questionnaires to the Bureau of Labor Statistics later. The leisure and hospitality industry is the main reason for recent data revisions, as many businesses in this industry are small in size. They stated, "Regardless of the reasons for the revisions, we should subtract about 30,000 workers from the initial employment numbers for June and focus on the trend rather than single-month figures."