U.S. nonfarm payroll employment increased by 29,000 in September, while the unemployment rate stood at 4.2%, according to the Bureau of Labor Statistics report released on October 2, 2026. The monthly change in employment was limited, with little movement across most major industries. The result marked a clear slowdown from August’s payroll increase, which was revised to 133,000.
The number of unemployed people was 7.1 million in September. The unemployment rate has remained within a narrow range of 4.1% to 4.3% since March. The labor force participation rate was 61.8%, while the employment-population ratio was 59.2%. The number of people working part time for economic reasons was 4.5 million, and 5.8 million people outside the labor force said they wanted a job.
Industry data showed that the modest increase was concentrated in a limited number of areas. Health care employment rose by 17,000, below its average monthly gain of 33,000 during the previous 12 months. Construction added 11,000 jobs, while manufacturing increased by 9,000. Employment in financial activities declined by 7,000 and was down by 129,000 from its most recent peak in May 2025.
Wage indicators also showed slower momentum. Average hourly earnings for private nonfarm employees edged up by five cents, or 0.1%, to $37.81 in September. Earnings were 3% higher than a year earlier. Average hourly pay for private-sector production and nonsupervisory employees rose by seven cents to $32.60. The average workweek for all private nonfarm employees remained unchanged at 34.4 hours.
Downward revisions to earlier months were another important part of the report. July’s payroll change was revised from a gain of 21,000 to a decline of 10,000. August was revised from an increase of 162,000 to 133,000. Combined employment gains for July and August were therefore 60,000 lower than previously reported. BLS said such revisions reflect additional business reports and recalculated seasonal factors.
The employment report is based on two separate surveys. The household survey measures labor force status, unemployment and demographic characteristics, while the establishment survey tracks payroll employment, hours and earnings. The monthly payroll change and the unemployment rate therefore come from different datasets. BLS notes that sampling error and later revisions should be considered when interpreting short-term movements.
Financial markets interpreted the softer report as reducing the likelihood of another near-term interest-rate increase. Reuters and the Associated Press reported that U.S. stock indexes advanced and the 10-year Treasury yield declined during the session. The employment report, however, does not determine monetary policy on its own. The Federal Reserve considers inflation, wages and a broader set of economic indicators when setting rates.
The September figures point to a low pace of hiring rather than a sudden collapse in the labor market. BLS said payroll employment had increased by an average of 45,000 per month during the previous 12 months. Modest gains continued in health care, construction and manufacturing, while monthly changes in information, professional services, retail, transportation, leisure and hospitality, and government were limited.
The number of people unemployed for 27 weeks or longer was 1.9 million, representing 27.1% of all unemployed people. The number of people marginally attached to the labor force fell by 236,000 to 1.5 million. Discouraged workers, who were not looking because they believed no jobs were available, numbered 414,000. These measures provide additional context beyond the headline unemployment rate.
The next U.S. employment report is scheduled for November 6, 2026. The October data will help show whether September’s weak payroll increase was temporary and whether unemployment remains within its recent range. The central findings are a 29,000 increase in nonfarm employment, a 4.2% unemployment rate, and a combined downward revision of 60,000 jobs for July and August.
