U.S. payrolls jump 162,000 in August

U.S. employers added jobs at a much faster pace in August than economists expected, easing concerns that the summer slowdown in hiring was deepening. Nonfarm payrolls increased by a seasonally adjusted 162,000 last month, the Bureau of Labor Statistics said Friday, after a softer stretch earlier in the summer.

Labor market steadies

The unemployment rate held at 4.1%, matching forecasts and suggesting the labor market remained broadly stable. That reading was 0.2 percentage point lower than a year earlier, reinforcing the view that conditions have not deteriorated sharply despite the softer tone in recent months.

The headline payroll gain compared with a Dow Jones consensus estimate for only 53,000 new jobs. The stronger-than-expected number was enough to revive the picture of a resilient labor market, even as policymakers remain alert to signs of cooling in hiring and spending.

A separate household survey showed employment rising by 569,000 in August, while the labor force expanded by 683,000. That helped keep the jobless rate unchanged even as the labor force participation rate increased by 0.2 percentage point, a sign that more people were either working or looking for work.

Market reaction and Fed focus

The report kept the Federal Reserve’s attention on the balance between employment and inflation ahead of its next policy decision. With hiring still firm enough to avoid a rise in unemployment, investors are likely to see next week’s inflation figures as the key remaining input before the rate decision in less than two weeks.

Markets reacted quickly. Stock index futures moved lower after the release, while Treasury yields rose, especially on shorter maturities that are most sensitive to Fed policy expectations. That move reflected reduced urgency for immediate policy easing.

An alternative unemployment measure that includes discouraged workers and people working part time for economic reasons fell to 7.7%, its lowest level since June 2025. The decline added to the picture of a labor market that is softer than at its post-pandemic peak, but still solid by historical standards.

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