US adds over a quarter of a million jobs, unemployment dips to 4.1%

The U.S. labor market surged in September, adding a robust 254,000 jobs that far exceeded expectations, boosting business confidence.

The new jobs report figures significantly increased from the 159,000 jobs added in August, according to the Department of Labor.

September’s job gains were broad, with several industries showing strong growth.

At the same time, the unemployment rate fell for the second consecutive month, dropping from 4.2 percent and 4.1 percent.

Restaurants and bars added 69,000 new roles, while the health care sector grew by 45,000.

Other industries also contributed to the rise: government agencies added 31,000 positions, social assistance employers added 27,000, and construction companies created 25,000.

Professional and business services, which had lost jobs for three straight months, bounced back with 17,000 new positions.

The Labor Department also revised its estimates for July and August, adding a combined 72,000 jobs to earlier figures.

“The September jobs report shows a nice bump in labor demand at the beginning of the fall. The U.S. economy is growing solidly in 2024 even as inflation slows to near the [Federal Reserve’s] target,” said Bill Adams, chief economist at Comerica Bank.

Hourly wages are also on the up—they rose by 0.4 percent in September, and on a year-over-year basis, wages increased by 4 percent, up from 3.9 percent in August.

The job market’s strength has fueled optimism about the Federal Reserve’s efforts to balance economic growth with inflation control.

Following this robust report, the Fed is likely to implement smaller interest rate cuts, possibly moving to a more typical quarter-point reduction in the coming months.

Despite these positives, President Joe Biden and Vice President Kamala Harris still face mounting criticism as inflation, which remains 19 percent above February 2021 levels, continues to weigh on Americans.

Many voters remain unimpressed with the state of the economy ahead of the Nov. 5 presidential election, particularly as former President Donald Trump positions himself as a pro-business, ultra-low-tax alternative.

The October jobs report, set to be released four days before the election, could be muddied by the aftermath of Hurricane Helene and a Boeing Machinists’ strike, complicating the economic picture.

Layoffs and unemployment claims are both hovering near historic lows.

Companies are largely reluctant to let workers go, and in turn, employees are less than keen to reenter the job market—the number of people quitting their jobs has reached its lowest level since August 2020, when the economy was still reeling from COVID.

As the U.S. economy continues its steady recovery, experts remain cautiously optimistic.

The next few months will be critical, with the Federal Reserve closely watching key indicators to guide next steps.

Most economists say the Fed appears to have achieved the once unlikely prospect of a “soft landing,” in which high interest rates help vanquish inflation without triggering a recession.

Interest rates were raised 11 times between 2022 and 2023.

Last month, Federal Reserve Chair Jerome Powell said the country is the closest it has been to declaring victory over inflation in recent years.

“We know it is time to recalibrate our (interest rate) policy to something that’s more appropriate given the progress on inflation,” Powell said.

“We’re not saying, ‘mission accomplished’…but I have to say, though, we’re encouraged by the progress that we have made.”

This article includes reporting from The Associated Press.