US payroll growth slows to 29,000 in September as unemployment rises to 4.2%
US payrolls rose by 29,000 in September 2026, while unemployment increased to 4.2% and nominal hourly earnings grew 3.02% from a year earlier. The figures point to softer labour demand after August’s stronger job gain.
US nonfarm payrolls increased by 29,000 jobs in September 2026, unemployment rose to 4.2%, and nominal average hourly earnings increased 3.02% from a year earlier, according to U.S. Bureau of Labor Statistics series. The combination points to softer labour demand than in August, with slower employment growth accompanied by a higher jobless rate and easing annual wage growth.
Payroll gains remain uneven
The seasonally adjusted payroll increase followed a gain of 133,000 in August. September therefore did not sustain the preceding month’s stronger pace, although employment continued to expand. The CES establishment survey put total nonfarm employment at 159.044 million; the monthly gain measures the change between consecutive seasonally adjusted employment levels, rather than gross hiring.
The recent history argues against treating either August’s strength or September’s slowdown as a settled trend. Payroll growth had already slowed between April and June, before employment fell by 10,000 in July and rebounded in August. September’s gain was close to June’s 31,000, placing it toward the weaker end of the April–September readings without marking a return to outright job losses.
Unemployment and pay reinforce the softer reading
The unemployment rate increased from 4.1% in August to 4.2% in September. That reverses part of the improvement seen earlier in the period, but leaves the rate below April and May’s 4.3%. This household-survey measure provides a separate signal from payroll employment: it comes from the CPS and is not calculated from the establishment survey’s job count.
Average hourly earnings for all employees in private industries reached $37.81, up 0.13% on the month. Annual growth eased from 3.11% in August and was below April’s 3.57%. Pay growth thus supports the softer reading, though these are nominal hourly earnings, not inflation-adjusted earnings or household income. Taken together, employment, unemployment and pay indicate cooling in September, while the uneven payroll record limits the case for a persistent pace of deterioration.
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