First American Properties CEO Michael S. Eisenga: Labor Market Data Offers Stark Warning of Impending U.S. Recession

COLUMBUS, Wis., Aug. 01, 2025 (GLOBE NEWSWIRE) -- Michael S. Eisenga, CEO of First American Properties LLC, has issued a sober assessment of the U.S. economy following the latest July employment report, calling the labor market figures a "clear inflection point" signaling that the nation is on a path toward recession.

“The numbers speak for themselves,” said Eisenga. “The July report doesn’t just reflect a slowdown—it exposes the structural cracks emerging across our labor market and broader economy. These are not isolated statistical anomalies. This is a meaningful deceleration in economic momentum.”

According to the U.S. Bureau of Labor Statistics, only 73,000 jobs were added in July, significantly below consensus expectations of 110,000. This disappointing figure comes on the heels of massive downward revisions to job gains in May and June, with a combined 258,000 positions removed from previously reported totals. May was slashed from +144,000 to just +19,000, while June fell from +147,000 to a mere +14,000.

The three-month trend tells an even more concerning story. From May through July, net job creation totaled approximately 106,000, down sharply from 380,000 in the previous quarter, a stunning drop of over 70%.

Meanwhile, the unemployment rate ticked up to 4.2% from 4.1% in June, despite the labor force participation rate edging down to 62.3%, suggesting more Americans are giving up on finding work. Demographic factors, tighter immigration enforcement, and aging workers are all contributing to a shrinking labor pool—particularly in key sectors like agriculture, construction, and hospitality. The numbers are much worse in reality as it is estimated approximately 5.1 million Americans are jobless but are no longer receiving Unemployment benefits.

“It's not just that fewer jobs are being created,” Eisenga noted. “It’s where and how they’re being created that raises alarms. Hiring is now concentrated in healthcare and social services—these sectors made up nearly 94% of net job gains in July, while traditional middle-class industries like manufacturing, construction, and professional services are bleeding jobs.”

Key Highlights from July’s Labor Data:

Wage growth data paints a mixed picture. While average hourly earnings rose 0.3% month-over-month and 3.7% year-over-year, real wage gains after inflation sit at a muted +1.0%, with disproportionate benefits going to higher-paid professionals in sectors like legal, marketing, and tech. Entry-level and service workers continue to lag, and only 57% of workers are seeing pay increases above inflation, according to the Indeed Wage Tracker.

Markets reacted swiftly to the disappointing report. Stock futures plunged, and Treasury yields fell sharply, as investors repriced their expectations for Federal Reserve policy. The probability of a September rate cut surged from 45% to 85%, reflecting growing pressure on the Fed to loosen monetary policy in the face of economic weakness.

“Investors are no longer asking if a rate cut is coming, they’re asking how soon and how many,” Eisenga said. “The Fed now finds itself cornered. Weak job creation, declining participation, and downward revisions leave little room for ambiguity: the economy is cooling faster than anticipated.”

Eisenga also highlighted the risks of policy missteps amid mounting trade frictions and geopolitical uncertainty. “When businesses start cutting back on administrative, manufacturing, and federal roles, it’s a sign they’re losing confidence—not just in current demand, but in the policy environment ahead,” he warned.

As sectors like manufacturing and professional services contract, young workers and early career professionals are feeling the squeeze. Entry-level hiring has slowed substantially, while youth unemployment remains disproportionately high. Minority groups and younger demographics face greater barriers to workforce participation, adding to economic inequality.

“These trends have been building for several years,” Eisenga said. “We’re coming down from the sugar high of COVID-era stimulus—free money, mortgage moratoriums, and deferred student loan payments. Now those protections are gone, and the underlying economic weaknesses are surfacing.”

Eisenga pointed to the Federal Reserve’s ongoing refusal to meaningfully cut interest rates as a key driver of tightening financial conditions, particularly as household expenses rise and access to credit contracts. “When you combine evaporating pandemic relief with higher debt obligations and a Fed that’s still standing on the brakes, recession signs shouldn’t surprise anyone,” he added. “What we’re seeing is not a shock—it’s the natural outcome of ignoring economic fundamentals for too long.”

Contact:

First American Properties LLC
1-920-350-5754

meisenga@firstamericanusa.com

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