September Hiring Falls Short
The US economy added only 29,000 jobs in September, according to the Labor Department, significantly below Wall Street's expectation of 84,000. The unemployment rate edged up from 4.1% to 4.2%. This disappointing figure underscores a broader slowdown in the labor market.[S1]
The broader trend for the year is just as lackluster. Between January and September, the nation gained 612,000 positions. Looking back over two decades, just two years — 2010 and 2025 — produced smaller increases, leaving aside the three years when payrolls shrank outright: 2008, 2009 and 2020.[S1]
Healthcare Leads, Other Sectors Lag
Healthcare was the primary driver of September's job gains, accounting for roughly 80% of the month's net increase. Construction, hospitality, and manufacturing also added positions. However, government employment fell by 17,000, and information, business services, and finance also contracted.[S1]
Over a longer horizon, the labor market has become heavily reliant on healthcare. Since 2022, healthcare employment has grown by 18%, with steady expansion. Construction, largely fueled by data centers, is up nearly 10%, while government is up 6%. All other sectors combined have grown by just 3%.[S1]
Wages Trail Inflation for Fifth Month
Wage growth has slowed to about 3% year-over-year, the weakest pace in five years. Meanwhile, inflation last month stood at 3.4%. This marks the fifth consecutive month that wages have failed to keep up with prices, meaning the average paycheck now buys less than it did a year ago.[S1]
