Updated on Oct. 2.
September hiring weakens
Unemployment was 4.2% in September, up 0.1 percentage point from August, according to the September jobs report released by the Bureau of Labor Statistics on Oct. 2.
Total employment grew by 29,000 — well below economists’ forecast of 84,000. In addition, July’s hiring numbers were revised down by 31,000 to -10,000, while August was revised down by 29,000 to 133,000. Together there were 60,000 fewer jobs added in July and August than originally reported.
More details below.
What are the weekly jobless claims?
Initial jobless claims went down for the week ending Sept. 26, according to the report released on Oct. 1.
Why it matters: The weekly jobless claims, or initial claims, are the number of unemployment insurance claims filed in the past week. They provide an indicator of the strength — or weakness — of the labor market.
Learn more
Jobless claims were 197,000 for the week ending Sept. 26, down by 1,000 from the previous week’s revised level of 198,000.
The new four-week moving average — a measurement of the number of people who filed for unemployment insurance for the first time over the last four weeks — was 200,000, down by 2,500 from the previous week's revised average of 202,500.
What's the insured unemployment rate?
Not all types of unemployment are included as part of the insured unemployment rate. It only includes "covered unemployment," as in people who receive unemployment benefits. Those who quit their jobs, for example, aren't included in the insured unemployment rate because they aren't eligible for unemployment benefits.
The advance seasonally adjusted insured unemployment rate — the rate of continuous covered unemployment claims divided by covered employment — was 1.1% for the week ending Sept. 19, unchanged from the previous week’s unrevised rate.
Job openings changed little in August
There were 7.1 million job openings in August, down slightly from July (7.3 million), according to the latest Job Openings and Labor Turnover Summary (JOLTS), released on Sept. 29 by the Bureau of Labor Statistics (BLS). The job openings rate held at 4.3% in August.
Here are some other highlights from the report:
- Hires changed little at 5.2 million and the rate at 3.3%.
- Total separations were unchanged at 5.1 million.
- Quits were unchanged at 3.1 million and the rate remained at 1.9%,
- Layoffs and discharges were essentially unchanged at 1.6 million. The rate was 1%.
The latest figures continue to show relatively little movement in the labor market. The number of job openings has remained around 7 million, while hiring and quits have also remained broadly stable.
The unemployment rate held steady at 4.1% in August, unchanged from July, according to the August jobs report released Sept. 4 by the Bureau of Labor Statistics (BLS).
Meet MoneyNerd, your shortcut to smart money moves
NerdWallet's twice-weekly newsletter offers practical, no-fluff guidance to help you spend smarter, save more, and make confident money decisions. Delivered free to your inbox.
What is the current unemployment rate?
The current unemployment rate is 4.2% for September, up by 0.1 percentage point from August.
The unemployment rate has risen since hitting a 50-year low of 3.4% in April 2023. Since May 2024, the unemployment rate has mostly stayed between 4% and 4.2%.
How the unemployment rate is calculated
The unemployment rate is calculated by dividing the number of unemployed people by the number of people in the labor force. (The labor force is considered the sum of those who are currently working or looking for work.) The result is then multiplied by 100 to get a percentage:
Number of unemployed people / Labor force x 100 = X%, which is the unemployment rate
Will unemployment go up soon?
The labor market showed signs of weakening throughout 2025 and that trend has continued into 2026.
The recent rise in unemployment was a byproduct of monetary policymakers’ effort to curb inflation by hiking interest rates. The Federal Reserve raised the federal funds rate 11 times between March 2022 and July 2023. Now that inflation is consistently slowing, the Fed has taken steps to prevent unemployment from rising further.
The Fed cut rates in 2024 at its September, November and December meetings. It paused rates at every meeting so far in 2025, but has indicated that there could be some rate cuts in 2025.
The Fed cut rates three times in 2025 before pausing in January. It also paused rates in March and April.
» MORE: What is the minimum wage?
Are wages increasing?
Wage growth is lower than it was a year ago and now closer to pre-pandemic levels, according to data from the Federal Reserve Bank of Atlanta. The three-month moving average of median hourly wage growth — when measured over the previous 12 months — has slowed from its peak in the summer of 2022.
For June, the three-month wage growth percent change was 3.8%, unchanged from May.
What does the Employment Cost Index show?
Increases in compensation costs in the second quarter of 2026 matched the last quarter of 2025 but were slower than a year ago, according to the most recent quarterly BLS Employment Cost Index, which measures wage and salary growth. Wages and salaries, as well as benefits, comprise total compensation costs.
The June 2026 report, released on July 31, shows compensation costs increased by 0.9% in the second quarter of 2026.
Year-over-year measurements show that compensation cost increases held steady in Q2 2026 (3.4%), matching the pace of the first quarter of 2026, but slower than the rates seen throughout 2024.
- Q2 2026: 3.4%
- Q1 2026: 3.4%
- Q4 2025: 3.4%
- Q3 2025: 3.6%
- Q2 2025: 3.6%
- Q1 2025: 3.6%
- Q4 2024: 3.8%
- Q3 2024: 3.9%
- Q2 2024: 4.0%
- Q1 2024: 4.2%
For the 12-month period ending in June 2026, wages and salaries increased 3.1%, compared to 3.5% for the 12-month period ending in March 2026.
Benefit costs had matched the increase in the 12-month period ending in June (3.8%) compared to the 12-month period ending in March 2026.
More key jobs data and what it means
What happened in September?
The economy grew by 29,000 jobs in September, according to the BLS, while economists had expected higher gains. Revisions also show job growth was weaker than previously reported in both July and August. Here’s how many jobs were added in previous months.
- 133,000 in August
- -10,000 in July
- 31,000 in June.
- 63,000 in May.
- 148,000 in April.
- 214,000 in March.
- -156,000 in February.
- 160,000 in January.
- 48,000 in December.
- 41,000 in November.
- -173,000 in October.
- 119,000 in September.
What is the labor force participation rate?
The labor force participation rate went up by 0.2 percentage points from 61.6% in August to 61.8% in September, according to the Bureau of Labor Statistics.
Why it matters: The labor force participation rate is the percentage of the population that is working or looking for work.
The rate is calculated as the labor force divided by the total population that’s eligible to work. (The Bureau of Labor Statistics defines the total population that’s eligible to work as the “civilian noninstitutional population,” which refers to people ages 16 and older who are not in military service or incarcerated.) The result is multiplied by 100 to get a percentage:
Labor force / Civilian noninstitutional population x 100 = X%, which is the labor force participation rate
Since October 2002, the labor force participation rate was lowest in April 2020 (60.1%) and highest in June 2003 (66.5%), according to BLS data.
How many job openings were there in August?
The latest Job Openings and Labor Turnover Summary (JOLTS), released on Sept. 29, shows job openings were 7.1 million in August compared to:
- 7.3 million in July.
- 7.2 million in June.
- 7.6 million in May
- 7.6 million in April
- 6.9 million in March
- 6.9 million in February
- 7.2 million in January 2026
- 6.6 million in December 2025
- 6.9 million in November 2025
- 7.4 million in October 2025
- 7.7 million in September 2025
- 7.2 million in August 2025
The seasonally adjusted job openings rate was 4.3% in August, down 0.1 percentage point from July. The job openings rate in August 2025 was 4.3%.
What is the layoff rate?
The rate of layoffs in August (1%) was unchanged from July, according to the most recent JOLTS report.
What is the quit rate?
The JOLTS report also shows the quit rate in August was 1.9%, unchanged from July. Quits decreased in other services (-46,000). Quits fell in wholesale trade (-34,000) and in state and local government education (-21,000). Quits rose in nondurable goods manufacturing (+28,000) and in private educational services (+13,000).
Why it matters: Economists say quit rates are a key factor in the health of employment prospects since quitting shows that workers feel safe making a job switch within their sector or outside it entirely.
The current quit rate is slightly below pre-pandemic levels after peaking at 3% in both Nov. 2021 and April 2022.
When is the next jobs report?
The next jobs report will show data for October and it will be released on Nov. 6.
(Photo by Spencer Platt/Getty Images News via Getty Images)
