Data Brief: September Payrolls Rise 29,000 as Revisions Cut 60,000 From Summer Hiring
The September jobs report was weaker than forecast on hiring, wages and unemployment. Two-year and 10-year Treasury yields both fell about 7 basis points.
Why it matters
- Revisions show summer hiring was weaker than first reported, and payroll growth has averaged 45,000 a month over the past year.
- Wage growth of 3.0% from a year earlier only matches core inflation on the latest PCE data, leaving little real pay growth.
- The report lands less than four weeks before the Fed's Oct. 27–28 meeting, where another rate increase is under debate.
Data Brief: a summary of published data, with our notes on what it shows.
The Bureau of Labor Statistics released its September employment report on Friday, Oct. 2. This brief summarizes the main figures and the first reaction in the Treasury market.
The headline numbers
| Measure | September | Prior month | Forecast |
|---|---|---|---|
| Nonfarm payrolls | +29,000 | +133,000 (revised) | +90,000 |
| Unemployment rate | 4.2% | 4.1% | 4.1% |
| Average hourly earnings, month | +0.1% | +0.3% | +0.3% |
| Average hourly earnings, year | +3.0% | +3.1% | +3.2% |
| Labor force participation | 61.8% | 61.6% | n/a |
Sources: BLS for actual figures; prior-month wage and participation figures as first reported in the August release. Forecasts as reported by Benzinga.
What it shows: hiring slowed sharply, the unemployment rate ticked up and monthly wage growth missed forecasts.
Revisions
The BLS cut its estimates for both earlier months:
| Month | Previous estimate | Revised | Change |
|---|---|---|---|
| July | +21,000 | −10,000 | −31,000 |
| August | +162,000 | +133,000 | −29,000 |
Combined, July and August were 60,000 jobs weaker than previously reported. Payroll growth has averaged 45,000 a month over the past 12 months, the BLS said.
By industry, health care added 17,000 jobs, construction 11,000 and manufacturing 9,000. Financial activities lost 7,000.
Treasury market reaction
| Yield | Level after report | Change |
|---|---|---|
| 2-year | 4.74% | −0.07 |
| 10-year | about 5.18% | −0.07 |
Source: Trading Economics.
Both ends of the curve fell by similar amounts, leaving the 10-year minus 2-year spread little changed at about 0.44 percentage point. The 10-year had topped 5.34% earlier in the week, its highest since 2002, Trading Economics reported.
Policy context
The core PCE price index rose 3.0% in the year to August, according to data released Sept. 30, 24/7 Wall St. reported. With wages now growing at the same 3.0% annual pace, real wage growth is roughly flat on that measure.
Before Friday's report, fed funds futures implied a 26.4% chance of a quarter-point rate increase at the Fed's Oct. 28 decision, according to Investing.com's Fed Rate Monitor.
Sources
- U.S. Bureau of Labor Statistics, The Employment Situation, September 2026
- Benzinga, September jobs report: economy adds 29K vs. 90K expected
- Trading Economics, U.S. 2-year note yield
- Trading Economics, U.S. 10-year Treasury yield
- 24/7 Wall St., Inflation cooled more than expected, but the government changed how it measures prices
- Investing.com, Fed Rate Monitor Tool
