The US unemployment rate edged upwards to 4.4% in September, according to data released Thursday by the Department of Labor, signaling a potential softening in the nation’s labor market. The number of unemployed Americans rose to 7.6 million, a slight increase from the 7.4 million reported previously.
Non-farm payroll growth registered at approximately 119,000, with gains primarily concentrated in healthcare, leisure and hospitality and social assistance sectors. Conversely, sectors like transportation and warehousing, alongside the public sector, experienced job losses. The number of long-term unemployed individuals currently stands at 1.8 million, representing a marginal decrease.
These figures are being intensely scrutinized by investors globally and they inject a layer of complexity into the ongoing debate surrounding monetary policy. A resilient labor market coupled with persistent inflation previously diminished expectations of imminent interest rate cuts. While lower rates would be welcomed by market participants seeking to bolster equity valuations and ease borrowing costs for businesses, the rising unemployment figure introduces a new data point that could prompt a reassessment of the Federal Reserve’s strategy.
The release of this September report, initially slated for early October, was delayed due to the recent government shutdown. While household data collection was completed prior to the shutdown’s commencement, data from the employer survey was compiled through electronic submissions both before and during the disruption. Notably, the shutdown will lead to a complete absence of employment data publication in October 2025 due to the inability to conduct the requisite survey. This presents a significant gap in economic data, potentially hindering future analysis and policy decisions. The delayed and now fragmented data stream raises questions about the reliability of future labor market assessments and underscores the vulnerability of crucial economic indicators to political gridlock.
