The U.S. military conflict with Iran is quietly draining the American labor market, with Goldman Sachs estimating that the oil price shock triggered by the war will suppress payroll growth by roughly 10,000 jobs per month through the end of the year – a toll that will be felt most acutely in restaurants, hotels and retail stores across the country.
In a research note published Thursday, Goldman economist [Pierfrancesco Mei](https://www.pierfrancescomei.com/) laid out a detailed framework for how higher energy prices translate into labor market pain – and the picture isn’t pretty.
The damage isn’t distributed evenly. Goldman’s sector-level analysis points to leisure and hospitality as the single hardest-hit industry, accounting for roughly 5,000 lost jobs per month, with retail trade shedding another 2,000. The logic is straightforward: when energy prices surge, consumers cut back on discretionary spending first — skipping vacations, eating out less, and trimming shopping trips — while continuing to pay for essentials like healthcare and housing. The oil shock, in other words, hits the working-class service economy well before it touches more insulated sectors.
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The U.S. military conflict with Iran is quietly draining the American labor market, with Goldman Sachs estimating that the oil price shock triggered by the war will suppress payroll growth by roughly 10,000 jobs per month through the end of the year – a toll that will be felt most acutely in restaurants, hotels and retail stores across the country.
In a research note published Thursday, Goldman economist [Pierfrancesco Mei](https://www.pierfrancescomei.com/) laid out a detailed framework for how higher energy prices translate into labor market pain – and the picture isn’t pretty.
The damage isn’t distributed evenly. Goldman’s sector-level analysis points to leisure and hospitality as the single hardest-hit industry, accounting for roughly 5,000 lost jobs per month, with retail trade shedding another 2,000. The logic is straightforward: when energy prices surge, consumers cut back on discretionary spending first — skipping vacations, eating out less, and trimming shopping trips — while continuing to pay for essentials like healthcare and housing. The oil shock, in other words, hits the working-class service economy well before it touches more insulated sectors.