US job growth rebounds in September but unemployment rate rises to 4.4%

US employers created a stronger-than-expected 119,000 jobs in September, according to a key economic report released by the government after a seven-week delay caused by the federal shutdown.

The payroll increase was more than twice the 50,000 jobs economists had projected. However, the long-awaited report contained several concerning details.

Revised Labour Department figures showed that the economy actually lost 4,000 jobs in August, instead of posting the previously reported gain of 22,000. In total, revisions removed 33,000 jobs from the combined July and August numbers. The economy had also shed jobs in June, marking the first time since the 2020 pandemic that two monthly jobs reports in the same period turned negative.

Additionally, over 87% of September’s job growth came from just two sectors: healthcare and social assistance, and leisure and hospitality.

The report comes at a time of considerable uncertainty about the economy. The job market has been strained by the lingering effects of high interest rates and uncertainty around Trump’s erratic campaign to slap taxes on imports from almost every country on earth. But economic growth at midyear was resilient.

More from World

'Giveaway of key national security tools': Senate Democrats slam Trump for delaying China tech export rule F-35 jets, nuclear pact and more: MBS secures key deals on US visit as Trump designates Saudi non-Nato ally

“We’ve got these strong headline numbers, but when you look underneath that you’ll see that a lot of that is driven by healthcare,’’ said Cory Stahle, senior economist at the Indeed Hiring Lab. ”At the end of the day, the question is: Can you support an economic expansion on the back of one industry? Anybody would have a hard time arguing everybody should become a nurse.’’

The data, though late, was welcomed by businesses, investors, policymakers and the Federal Reserve. During the 43-day shutdown, they’d been groping in the dark for clues about the health of the American job market because federal workers had been furloughed and couldn’t collect the data.

Quick Reads

View All

Trump calls Democrats ‘traitors’, evokes death penalty over video urging military to refuse orders

Despite Trump tariffs, robust domestic economy gives India leverage over US in trade talks: Report

Healthcare and social assistance firms added more than 57,000 jobs in September, restaurants and bars 37,000, construction companies 19,000 and retailers almost 14,000. But factories shed 6,000 jobs — the fifth straight monthly drop. The federal government, targeted by Trump and billionaire Elon Musk’s DOGE cost cutters, lost 3,000 jobs, the eighth straight monthly decline..

Average hourly wages rose just 0.2% from August and 3.8% from a year earlier, edging closer to the 3.5% year-over-year increase that the Federal Reserve’s inflation fighters like to see.

The latest reading on jobs Thursday makes a rate cut by the Fed officials at their next meeting in December less likely. Many were already leaning against a cut next month, according to minutes of their October meeting released Wednesday. Steady hiring suggests the economy doesn’t need lower interest rates to expand.

The September jobs report will be the last one the Fed will see before its Dec. 9-10 meeting. Officials are split between those who see stubbornly high inflation as the main challenge they need to address by keeping rates elevated, and those who are more concerned that hiring is sluggish and needs to be supported by rate reductions.

Hiring has been strained this year by the lingering effects of high interest rates engineered to fight a 2021-2022 spike in inflation and uncertainty around Trump’s campaign to slap taxes on imports from almost every country on earth and on specific products — from copper to foreign films.

Labour Department revisions in September showed that the economy created 911,000 fewer jobs than originally reported in the year that ended in March. That meant that employers added an average of just 71,000 new jobs a month over that period, not the 147,000 first reported. Since March, job creation has fallen farther — to an average 59,000 a month.

With September numbers out, businesses, investors, policymakers and the Fed will have to wait awhile to get another good look at the numbers behind the American labour market.

The Labour Department said Wednesday that it won’t release a full jobs report for October because it couldn’t calculate the unemployment rate during the government shutdown.

Instead, it will release some of the October jobs data — including the number of jobs that employers created last month — along with the full November jobs report on Dec. 16, a couple of weeks late.

The 2025 job market has been marked by an awkward pairing: relatively weak hiring but few layoffs, meaning that Americans who have work mostly enjoy job security – but those who don’t often struggle to find employment.

Megan Fridenmaker, 28, lost her job last month as a writer for a podcast network in Indianapolis. She’s applied for at least 200 jobs and landed just one interview. “I am far from the only unemployed person in my friend group,’’ she said. “Where the job market’s at right now – people will apply for hundreds and hundreds (of jobs) before getting one interview.’’

“Out of everything I’ve applied for, I get a response from maybe a quarter of them,’’ she said. “And the vast majority of the responses are the automated – ‘Thank you so much, but we’ve gone with another candidate.’ ‘Thank you so much, but we’ve already filled the position.’

“The whole job-hunting experience has felt so cold and so distant and so removed from who we are as humans.’’

With inputs from agencies