U.S. non-farm payrolls surprised strongly to the upside in September, rising 119k versus expectations of 53k, more than making up for August’s downward revision from 22k to -4k. The stronger headline signals that hiring momentum hasn’t stalled as much as feared.
However, the details of the report were more mixed. The unemployment rate edged up from 4.3% to 4.4%, slightly above expectations. Though the increase came alongside a modest rise in participation from 62.3% to 62.4%, suggesting more workers entered the labor force.
Wage growth cooled, with average hourly earnings up only 0.2% mom, below the 0.3% consensus, bringing annual growth to 3.8% yoy. The average workweek held steady at 34.2 hours, pointing to no deterioration in hours worked.
Taken together, the data portray an economy that is still generating jobs but with softer wage pressures—likely welcomed by the Fed as it evaluates the necessity of another rate cut before year-end.
