According to September’s Employment Situation report from the Bureau of Labor Statistics, the job market was somewhat weaker in September, with payrolls up only 29,000, and the prior 2 months revised down by 60,000 jobs. In 2026 to date, payroll gains averaged 68,000 jobs per month, stronger than 2025’s growth, but still not an indication of a robust job market. The unemployment rate ticked up to 4.2 percent, largely because more people actively looked for work. Wage growth slowed further to a 3 percent rate.
With inflation still too high, the Federal Reserve is unlikely to cut rates anytime soon. However, these data showing a softer job market may be enough to keep the Fed on hold at their October meeting. Wage growth at 3 percent continues to run below the pace of inflation, which will hamper consumer spending over time. Households continue to be impacted by higher energy prices through higher gasoline prices, more expensive goods as transportation costs increase, and higher airfares.
