U.S. adds 29,000 jobs in September as unemployment reaches 4.2%

September payrolls rise as unemployment increases

The U.S. Bureau of Labor Statistics reported on October 2 that nonfarm payroll employment increased by 29,000 in September. The unemployment rate was 4.2%. Reuters independently reported those headline figures and noted that unemployment had been 4.1% in August.

The official release revised July’s payroll change to a loss of 10,000 jobs and August’s to a gain of 133,000. Together, the two earlier months contained 60,000 fewer jobs than previously estimated. BLS also reported that average hourly earnings on private nonfarm payrolls increased 3.0% over the preceding 12 months.

Payrolls and unemployment come from different surveys. The establishment survey measures jobs, hours and earnings; the household survey measures people’s labor-force status. Those measures are related, but one cannot be substituted for the other.

Payroll estimates remain subject to revision

These are reported estimates, not a final count that can never change. BLS explains that monthly payroll revisions incorporate additional employer reports and revised seasonal factors. Later releases may therefore alter the picture.

Reuters reported that the hiring result fell below its survey of economists’ expectations. Expectations are forecasts, not official measurements. Neither that surprise nor a single month’s unemployment rate confirms a recession or determines the Federal Reserve’s next policy decision.

Labor demand and the policy outlook — analysis

The report gives policymakers another measure of labor demand, alongside inflation and other economic evidence. Readers assessing the outlook should distinguish the latest estimate, revisions to earlier months and predictions about interest rates. A policy forecast should remain a forecast until a decision is announced.