By AZ Big Media
The US labor market proved resilient in September, adding 254,000 to payrolls for the highest job gains since March. Leading into today’s release, June–August showed an average of 116,000 monthly payroll job gains; revisions to July and August data now bring average gains over that period to 140,000, before September’s outsized growth. The unemployment rate ticked back down to 4.1%, with the number of unemployed workers falling by 281,000.
This report underscores that the Fed’s decision to cut rates last month was preemptive against risks that had yet to materialize. The report alleviated concerns of an abrupt hiring slowdown with upward revisions to recent months.
This is the first of five core datapoints that Fed policymakers will receive ahead of their November 7 meeting, along with Q3 GDP, PPI, PCE, and CPI. We see September’s jobs report as helping solidify policymakers’ consensus around two 25bps hikes to end 2024; however, additional data could still shift this narrative.
Trusted Insights for What’s Ahead
- The US labor market remained resilient in September, with 254,000 job gains. In addition, upward revisions to July and August leave Q3 average job creation at a strong 186,000.
- The unemployment rate declined to 4.1%, despite growth in the labor force, showing an improvement in job-finding for workers in September.
- While labor market churn remains low, the uptick in hiring and increase in job openings in August JOLTS data potentially show that demand jumped even ahead of the largely anticipated Fed interest rate cut on September 18.
- The US economy remains strong, with income and spending growth supportive of steady labor market conditions going into 2025.
- We anticipate that economic growth picks up in early 2025 as the outlook for businesses becomes clearer with the Fed’s cutting cycle and following the US election.
