Though a lackluster jobs report and weaker wage growth may sap consumer confidence, these factors could prompt the Fed to hold off on raising interest rates. This indicates "a more pronounced slowdown in the labor market than previously understood," Cotality Chief Economist Selma Hepp said. While the Fed doesn't meet again until mid-September, this latest data will give investors more confidence that short-term interest rates will remain on pause. A cooling labor market "shifts the balance of risks for the Federal Reserve," Williamson said. Mortgage rates would likely climb even higher if the labor market was stronger, Krimmel noted.