U.S. employers added 29,000 nonfarm jobs in September 2026, well below the 84,000 to 90,000 economists expected, the Bureau of Labor Statistics reported on October 2. The unemployment rate rose to 4.2% from 4.1%, and revisions cut 60,000 jobs from July and August, showing a labor market that is cooling faster than forecasters expected.
Key Takeaways
- July payrolls were revised from +21,000 to −10,000, so the economy lost jobs that month instead of adding them.
- Payroll growth has averaged 45,000 a month over the past 12 months. In 2025 it averaged about 15,000 a month.
- Average hourly earnings rose 0.1% to $37.81 in September and are up 3.0% from a year earlier.
- Financial activities employment is down 129,000 since May 2025, including 90,000 jobs lost at insurance carriers and related businesses.
- The unemployment rate for Black workers rose to 7.0%, the only major demographic group with a notable change in September.
- On October 2, the S&P 500 closed at 7,722.72 (+0.73%), the Dow at 51,176.96 (+0.49%), and the Nasdaq Composite at 27,190.86 (+1.19%).
The Revisions Change the Picture More Than the Headline
The 29,000 headline number missed expectations, but the revisions matter more. The Bureau of Labor Statistics lowered August from 162,000 to 133,000 and July from 21,000 to a loss of 10,000. August’s first estimate had made hiring look like it was picking up after a weak summer. The revised figures show a slower trend instead.
Taken together, the three months point to a labor market that is still adding jobs, but slowly. Over the last 12 months, payroll growth has averaged 45,000 a month. That is better than the roughly 15,000 monthly average in 2025, but well below the pace economists usually associate with a strong economy.
Health Care and Construction Lead While Finance Keeps Shrinking
BLS reported that employment in every major industry changed little in September, but some sectors stand out. Health care added 17,000 jobs, about half its 12-month average of 33,000. Hospitals and outpatient care grew, while nursing and residential care facilities cut 9,000 positions.
Construction added 11,000 jobs, close to its 12-month average of 10,000, with nonresidential specialty trade contractors leading. Manufacturing added 9,000 jobs and is up 72,000 since a low in December 2025, helped by plastics, rubber, and machinery.
Financial activities lost 7,000 jobs. The sector has shed 129,000 positions since May 2025, mostly at insurance carriers and related businesses. For small business owners in financial services, that suggests more experienced workers may be available to hire, but also signals weaker demand in the industry.
Wage Growth Slows to 3.0% Year Over Year
Average hourly earnings for private-sector workers rose 5 cents to $37.81. Over the past 12 months, earnings are up 3.0%. Production and nonsupervisory workers saw a slightly larger monthly gain, up 0.2% to $32.60. The average workweek stayed at 34.4 hours, and manufacturing overtime held at 3.0 hours.
Slower wage growth affects businesses in two ways. Labor costs are rising more slowly, which helps employers. But consumers’ purchasing power is growing more slowly too, especially with high gas prices. Businesses that depend on discretionary spending should account for both.
The Household Survey Shows a Steady but Softer Labor Market
The household survey shows a similar picture. The unemployment rate has stayed between 4.1% and 4.3% since March, and 7.1 million people were unemployed in September. Labor force participation was 61.8% and the employment-population ratio was 59.2%. Neither has changed much since January.
About 1.9 million people have been unemployed for 27 weeks or longer, 27.1% of all unemployed workers. Another 4.5 million people worked part time because they could not find full-time jobs or had their hours cut.
The 7.0% unemployment rate for Black workers was the clearest change in the demographic data. Rates for adult men (3.9%), adult women (3.6%), White workers (3.6%), Asian workers (2.9%), and Hispanic workers (4.7%) were little changed.
Markets Pare Expectations for Another Fed Rate Increase
Stocks rose after the report as traders lowered their expectations of another Federal Reserve rate increase in October. The S&P 500 gained 0.73%, the Dow added 250 points, and the Nasdaq Composite rose 1.19%. On Monday, October 5, the Institute for Supply Management’s Services PMI came in at 54.9, down from 55.4 in August, and its services employment index was 50.1, barely above the line that separates growth from contraction.
Borrowing costs are still high even as expectations for rate hikes fall. The 30-year fixed mortgage rate averaged 7.28% in Freddie Mac’s October 1 survey, up from 6.34% a year earlier. Weak hiring combined with high borrowing costs is a difficult mix for businesses planning to expand.
What Business Owners Should Watch Before November 6
The October jobs report comes out November 6, 2026. Before then, business owners can track weekly jobless claims, the next ISM reports, and Freddie Mac’s weekly mortgage survey to see whether weak hiring is turning into lower demand. Companies that are hiring may find more candidates available in finance and insurance. Companies selling to consumers should plan for slower wage growth limiting household spending through the fourth quarter.
FAQs
How Many Jobs Were Added in September 2026?
U.S. nonfarm payrolls rose by 29,000 in September 2026, according to the Bureau of Labor Statistics. Economists had expected 84,000 to 90,000.
What Is the Current U.S. Unemployment Rate?
The unemployment rate was 4.2% in September 2026, up from 4.1% in August. It has stayed between 4.1% and 4.3% since March.
How Much Were July and August Jobs Revised?
July was revised from +21,000 to −10,000 and August from +162,000 to +133,000. Combined, the two months are 60,000 jobs lower than first reported.
How Fast Are Wages Growing in 2026?
Average hourly earnings rose 0.1% in September to $37.81 and are up 3.0% over the past 12 months.
When Is the Next Jobs Report?
The Bureau of Labor Statistics will release the October 2026 jobs report on Friday, November 6, 2026, at 8:30 a.m. ET.
