The federal government on Thursday released its overdue employment report for September showing U.S. employers added 119,000 jobs that month, but the national unemployment rate also crept up to 4.4%, the highest level in almost four years.
The 43-day government shutdown from Oct. 1 to Nov. 12 caused the September report to be released almost seven weeks behind schedule. The U.S. Bureau of Labor Statistics has said there will be no report for October, and that November data will be released Dec. 16.
Although the September data is somewhat stale, it still offers economists insights into how the economy was performing this fall after lackluster hiring in the summer. The September report revised downward the preliminary hiring numbers released for August and July by -33,000 jobs.
August hiring was revised downward by -26,000 jobs from +22,000 to -4,000 jobs. The July hiring numbers were revised downward from +79,000 to +72,000. The unemployment rate for September (4.4%) is 0.1 percentage points higher than August (4.3%) and 0.2 points higher than July (4.2%). September showed the highest level of unemployment since October 2021 (4.6%).
In September, hiring trended up in healthcare (+43,000), food services and drinking places (+37,000), and social assistance (+14,000). Transportation and warehousing (-25,000) and the federal government (-3,000) lost jobs for the month. Federal employment has lost 97,000 jobs since January. There was little change in other major industries.
The report shows that 7.6 million people were unemployed in September, and the long-term unemployed (27 weeks or more) account for 23.6% of that total.
Average hourly earnings of employees on private nonfarm payrolls rose by 9 cents, or 0.2%, to $36.67 in September. Hourly earnings have increased by 3.8% since September 2024.
The mixed data in the September report showing an uptick in hiring, but the rise in unemployment creates uncertainty on what path the Federal Reserve Board will follow when it holds its next meeting Dec. 10 on whether to lower interest rates. The November employment situation report will not be released by BLS until after the Fed's meeting.
Stocks moved higher immediately after the September report was released, but it was unclear if that was because the strong earnings posted by Nvidia, had eased concerns about AI and the tech sector, or if traders thought the uptick in unemployment may bode well for a Fed decision to possibly lower interest rates. The CME Group’s FedWatch tool put the possibility of an interest rate cut at 39.6% on Thursday afternoon, up from 30.1% the day prior.
