The U.S. unemployment rate ticked up to 4.2% in September, while the economy added only 29,000 jobs, well below the average monthly gain of 45,000 over the prior 12 months, according to data released Friday by the U.S. Bureau of Labor Statistics.
Although September’s jobless rate exceeded the 4.1% rate recorded in August, it is still lower than it was a year ago (4.4%). Since March, the national unemployment rate has fluctuated between 4.3% and 4.1%.
A hiring slowdown was seen across most major industries in September as overall employment levels showed relatively insignificant changes.
Health care employment continued its upward trend in September (+17,000), but at a slower pace than the average monthly gain over the prior 12 months (+33,000). In September, employment rose in ambulatory health care services (+13,000) and in hospitals (+12,000), while nursing and residential care facilities lost jobs (-9,000).
Construction added 11,000 jobs in September, which was in line with the industry's average monthly gain of 10,000 jobs each month over the prior 12 months.
Manufacturing jobs increased by 9,000 in September, a slowdown in hiring compared to August (+15,000). However, manufacturing has added 72,000 jobs since December.
The financial activities sector lost 7,000 jobs in September and is down by 129,000 jobs since the sector’s recent peak in May 2025. Most of these job losses have occurred in insurance carriers and related activities sectors (-90,000).
The information industry lost 10,000 jobs last month and now has 120,000 fewer than in September 2025. Publishing, which lost 32,600 jobs during that same 12-month period, has sustained the most job losses in that sector.
BLS also revised downward (-60,000) its previously released preliminary job numbers for July and August. August employment was revised downward by 29,000 from the previously reported gain of 162,000 to 133,000. July employment was revised downward by 31,000 from the previously reported gain of 21,000 jobs to an overall loss of -10,000 jobs.
In September, average hourly earnings for all employees on private nonfarm payrolls edged up by 5 cents, or 0.1% to $37.81. Over the past 12 months, average hourly earnings have increased by 3%. The current annual U.S. inflation rate is 3.4% for the 12-month period ending in August, the latest data available.
BLS is expected to release state-level unemployment data for September later this month. In August, New Jersey’s unemployment rate was 4.3%.
The stock market was higher after the weaker-than-expected September jobs report, which may have eased investor concerns about the possibility of aggressive interest rate hikes by the Federal Reserve.
