US payrolls rise just 29,000 in September, far short of forecasts
The reading is the weakest in this run of releases and undercuts a stronger September print reported earlier in the week.
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Chart: US nonfarm payrolls, change on the month
UpdateFriday, October 2, 2026 at 8:33 AM ET
The Labor Department also revised its prior two months of payroll data, cutting the combined July and August gains by a net 60,000. The revision lowers the base from which September's 29,000 increase is measured, reinforcing the picture of a labor market cooling faster than Wednesday's initial September print had suggested.
Nonfarm payrolls grew by 29,000 in September, well below the 90,000 economists expected and a sharp drop from the prior month's 162,000, the government's official report showed.
The unemployment rate rose to 4.2%, versus 4.1% expected and 4.1% prior. Average hourly earnings rose 0.1% from a month earlier, below the 0.3% forecast and the 0.3% pace seen previously.
The figures mark a reversal from Wednesday, when payrolls were reported as growing 90,000 in September, beating a 38,000 forecast and topping August's 75,000 rise. That earlier reading had added to pressure in the bond market ahead of the Fed's next policy decision, reviving arguments among some Fed officials for keeping rates higher for longer.
The weaker print also follows an August JOLTS report, released Tuesday, that showed job openings at 7.079 million, below the 7.23 million forecast and down from 7.335 million the month before, a slowdown Finobird said pointed to cooling labor demand. Taken together, the two reports pull the labor market back toward a picture of gradual cooling rather than the reacceleration suggested by Wednesday's payrolls number, and could reopen the case for the Fed to ease policy sooner than markets had recently priced.