US Labor Market Shows Signs of Cooling in September
The U.S. labor market showed signs of cooling in September, with nonfarm payroll employment increasing by just 29,000 jobs. This was a significant slowdown from August's revised gain of 133,000 and marked the seventh month out of the last 21 to see job losses.
Revisions to prior months were broadly negative, subtracting 60,000 jobs from previously reported totals compared with the 55,000 upward revision reported in the previous month. This has contributed to a slowing pace of hiring, with job growth averaging just 68,000 per month so far this year.
Wage growth also continued to cool, with average hourly earnings rising 3.0% year-over-year in September, down from 3.1% in August and marking the slowest pace since 2026 began. This deceleration points to easing wage pressures, even as hiring moderates.
Despite these signs of cooling, the labor force continued to grow, with the civilian labor force expanding by 485,000 in September. However, the unemployment rate edged up to 4.2%, as both employment and the labor force grew.