September Nonfarm Payrolls

September Nonfarm Payrolls
Updated: 02-Oct-26 09:17 ET

Highlights

The September employment report was skewed more toward a "bad news is good news" kind of read.
We say that recognizing that nonfarm payrolls increased by just 29,000, while revisions to July and August combined led to 60,000 fewer jobs than previously reported. The unemployment rate ticked up from 4.1% to 4.2% (still low) and average hourly earnings rose only 0.1% month-over-month, leaving them up 3.0% year-over-year versus 3.1% in August.

Key Factors

September nonfarm payrolls increased by 29,000 (Briefing.com consensus: 100,000). The 3-month average for total nonfarm payrolls was unchanged at 51,000. August nonfarm payrolls revised to 133,000 from 162,000. July nonfarm payrolls revised to -10,000 from 21,000.
September private sector payrolls increased by 46,000 (Briefing.com consensus: 100,000). August private sector payrolls revised to 89,000 from 127,000. July private sector payrolls revised to 28,000 from 71,000.
September unemployment rate was 4.2% (Briefing.com consensus: 4.1%) versus 4.1% in August. Persons unemployed for 27 weeks or more accounted for 27.1% of the unemployed versus 27.0% in August. The U6 unemployment rate, which accounts for unemployed and underemployed workers, decreased to 7.6% from 7.7% in August.
September average hourly earnings were up 0.1% (Briefing.com consensus: 0.3%) on the heels of a 0.3% increase in August. Over the last 12 months, average hourly earnings have risen 3.0% versus 3.1% for the 12 months ending in August.
The average workweek in September was 34.4 hours (Briefing.com consensus: 34.3) versus 34.4 hours in August. The manufacturing workweek was unchanged at 40.6 hours. Factory overtime was unchanged at 3.0 hours.
The labor force participation rate increased to 61.8% from 61.6% in August.
The employment-population ratio increased to 59.2% from 59.1% in August.

Big Picture

The key takeaway from the report is that it isn't going to exacerbate inflation concerns for the Fed. It won't eradicate those concerns, but in terms of the market's newfound belief that the Fed is unlikely to raise rates at its October FOMC meeting, this report slides neatly into that thinking.

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