US Economy Creates Only 29,000 Jobs in September as Unemployment Rises to 4.2%

The US economy created only 29,000 jobs in September, and the unemployment rate rose to 4.2%, one-tenth higher than in August, according to the Bureau of Labor Statistics (BLS) September employment report released on Friday, October 2.

Among Hispanic workers, the trend was the opposite: their unemployment rate fell from 4.8% to 4.7%.

The figures confirm that the labor market is continuing to cool. For families, this may mean that finding a job or getting a raise will take longer, just as prices and interest rates continue to squeeze budgets.

The Key Figures

• Jobs created: 29,000. This is a preliminary figure that may be revised in the coming months. The August figure was revised to 133,000.
• Overall unemployment: 4.2% (4.1% in August).
• Unemployment among Hispanics: 4.7% (4.8% in August).
• Labor participation: 61.8% of adults were working or looking for work, compared to 61.6% in August. When more people start looking for employment, the unemployment rate can also rise.

The Sectors That Hired

Advances were modest and concentrated in three areas: health and social services, with about 23,000 new jobs; construction, with about 11,000; and leisure and hospitality (restaurants, hotels, and entertainment), with about 10,000.

How Salaries Are Faring

The average hourly wage in the private sector reached $37.81, five cents more than in August and 3.0% more than a year ago, when it was $36.70.

However, this is a national average; what each person earns varies by industry, state, and experience.

The Fed Is Watching

The Federal Reserve is closely following these figures. At its meeting on September 16, it raised its reference rate by a quarter point, to a range of 3.75%-4%, to curb inflation. This rate influences what you pay for your credit cards, car loans, and mortgages.

What You Can Do

• If you lost your job, apply for unemployment benefits as soon as possible through your state’s labor agency.
• If you have variable-rate debt, such as credit card debt, try to pay it off first: it becomes more expensive every time the Fed raises rates.

Source: Bureau of Labor Statistics (BLS), The Employment Situation — September 2026, seasonally adjusted data. The September figures are preliminary.