In September, employers in the United States created 29,000 new jobs, a figure that fell short of economists’ predictions and indicates that many businesses are hesitant to expand their workforce due to challenges such as rising energy costs and increased inflation.

According to FactSet, financial data analysts had anticipated a gain of 90,000 jobs for the month. The unemployment rate experienced a minor increase, reaching 4.2% in September, compared to 4.1% in August.

Recent trends indicate an improvement in the labor market since last year, when the average monthly job addition was merely 10,000. Economists are particularly attentive to other indicators of labor market vitality, including wage growth, which has not kept pace with inflation for the past five months.

A report from outplacement firm Challenger, Gray & Christmas released on Thursday highlights a significant decline in layoffs for 2026. The number of job cuts through September has decreased by 40% compared to the same timeframe last year. Additionally, when looking at month-to-month changes, layoffs fell by 20% compared to September 2025, marking the lowest figures seen in the past four years.

Economists suggest that a robust labor market could provide the Federal Reserve with greater flexibility to increase interest rates in the near future. The central bank is focused on reducing inflation to its annual target of 2% and raised its key interest rate last month for the first time in over three years.

In August, the annual inflation rate in the U.S. rose to 3.4%, driven primarily by significant increases in energy prices.

—This news is breaking and will be updated.

Edited by Alain Sherter