US Adds 119,000 Jobs In September; Jobless Rate Rises To 4.4% In Delayed Report

The U.S. economy added a stronger-than-expected 119,000 jobs in September, even as the unemployment rate climbed to 4.4%, the highest level in nearly four years, according to a government report released Thursday after a weeks-long delay caused by the federal shutdown.

The long-awaited snapshot of the labor market offered a mixed picture. Hiring outpaced economists’ expectations, but the increase in joblessness and a sharp downward revision to August’s numbers pointed to a cooling trend. Instead of the previously reported gain of 22,000 jobs in August, the government now says the economy lost 4,000.

September’s strongest job gains came from health care, food services, and leisure and hospitality. Losses were concentrated in transportation and warehousing, manufacturing, and the federal government. Wage growth remained moderate, with average hourly earnings rising 0.2% from the previous month and 3.8% from a year earlier.

The shutdown prevented the Labor Department from collecting enough data in October, meaning that month’s report is being folded into the November release scheduled for mid-December. The omission leaves a gap in the economic record just as investors and policymakers look for clearer signals on the health of the job market.

The mixed data complicates the Federal Reserve’s path forward. While the stronger-than-expected hiring could argue against a rate cut in December, the rise in unemployment and signs of slowing wage pressures point in the opposite direction. Some analysts say the labor market’s softening is becoming more pronounced, while others note that job creation remains positive despite economic headwinds.

Financial markets reacted cautiously to the report as investors weighed the implications for the Fed’s next meeting. One major investment bank has already withdrawn its prediction for a December rate cut, citing the firmer-than-expected jobs gain.

The November employment report incorporating both October and November data is now viewed as a critical indicator for understanding whether the labor market is stabilizing, gradually cooling or beginning to weaken more sharply.