Arizona Jobs Drop Again in July
By George W. Hammond, EBRC director and Eller research professor
The state’s unemployment was steady at 4.1%
Arizona seasonally-adjusted jobs dropped by 4,900 in July, after a revised decline of 15,200 in June. The preliminary June estimate showed a decline of 8,400. The state’s seasonally-adjusted unemployment rate was steady at 4.1% in July, just below the U.S. at 4.2%.
July’s job losses were widespread and driven by leisure and hospitality (down 3,200); trade, transportation, and utilities (down 2,000); manufacturing (down 1,100); construction (down 1,000); government (down 700); professional and business services (down 600); and information (down 400).
Job losses were partly offset by gains in private education and health services (up 3,600); other services (up 200); natural resources and mining (up 200); and financial activities (up 100).
Arizona added 34,300 jobs over the year in July, which translated into 1.1% growth. That outpaced the U.S. at 0.9%. Job gains were very unbalanced, with private education and health services dominating gains (Exhibit 1). Four sectors were down over the year: manufacturing; government; trade, transportation, and utilities; and information.
Exhibit 1: Arizona Net Job Change (Thousands) and 2024 Annual Wages per Worker
The story was similar for the Phoenix MSA, with over the year growth of 28,400. That translated into 1.2% growth. Job gains were dominated by private education and health services. Trade, transportation, and utilities; manufacturing; and information lost jobs.
The Tucson MSA posted modest gains, with jobs up 2,500 over the year. That translated into 0.6% growth. Again, the largest job gains were in private education and health services. Jobs were down in government; trade, transportation, and utilities; manufacturing; construction; professional and business services; and information.
Jobs in the Prescott MSA increased 600 over the year in July, for 0.9% growth. Private education and health services, as well as government, jobs increased significantly. Those increases were partly offset by declines in trade, transportation, and utilities; leisure and hospitality; and manufacturing.
Year to date through July, Arizona jobs were up modestly, with 0.2% growth. Similarly, Phoenix MSA jobs were up 0.2%, while Tucson MSA jobs were down 0.3%. Prescott MSA jobs were also down over the year through July, with a 0.8% decline.
Arizona’s job growth in 2024 and and so far in 2025 has been unusually slow. That was partly driven by an increase in unemployment, with the seasonally-adjusted rate rising from 3.3% in March 2024 to 4.1% currently. Another important factor during the last two years has been a steep drop in the hires rate (Exhibit 2). The state hires rate has declined from 5.2% in July 2022 to 3.6% in June 2025. At the same time, the quits rate has fallen from 4.7% in March 2022 to 2.3% in June.
Exhibit 2: Arizona Hire and Quit Rates, Seasonally-Adjusted, Twelve-Month Moving Average
