Revised payrolls show US hiring cooled faster than first reported

Counting the revisions, payrolls grew by about 51,000 jobs a month across July, August and September ^[26]. The 60,000 jobs taken out of the summer come to more than twice September's whole gain ^[20][23]. Before the September report, employers had averaged 80,000 jobs a month this year, according to The Associated Press. That compares with 9,700 a month in 2025 and 166,000 in 2023 and 2024 ^[13]. The latest three months run well below this year's average and well above last year's ^[26][13].

The separations data point the other way. In the August turnover survey, layoffs fell and quits retreated slightly, while gross hiring ticked up modestly and stayed low ^[19]. Jobless claims fell for a fourth straight week, according to the Department of Labor ^[14]. "While hiring slowed to 29,000 jobs in September, few separations and jobless claims show that most people are holding onto their jobs," Danny Friel, lead economist at the financial technology company Chime, said ^[12].

The September gain was also narrow. Health care added 17,000 jobs ^[5], leaving about 12,000 for every other sector combined ^[21]. Construction and manufacturing posted slight gains ^[5]. ADP's private-sector report showed 90,000 jobs, but the BLS count covers a broader set of employers ^[24].

A skeptic would say a freeze is how a downturn begins. The Federal Reserve raised rates in September for the first time in three years, and the 10-year Treasury yield reached a 24-year high ^[8]. Higher energy prices tied to the war with Iran have pushed inflation up ^[17]. The Conference Board put consumer confidence at its lowest in more than a decade, the AP reported ^[25]. So far those pressures have not turned into job cuts ^[19][15]. Unemployment is still below the 4.5% it reached in November 2025 ^[14]. When the Fed raised rates on Sept. 16, chair Kevin Warsh described the labor market as consistent with full employment ^[9].

Workers are absorbing the freeze through pay. Average hourly earnings are up 3% over 12 months ^[6], against August inflation of 3.4% ^[16]. That is a gap of roughly 0.4 percentage points, though the two figures cover slightly different months ^[22]. CBS News reports that wage growth has lagged inflation for five consecutive months ^[11]. "This stability has helped keep consumers spending, but with wages trailing inflation since April ... that means fewer chances to move to a better-paying job," Friel said ^[7].

I think the record supports slowing requisitions and backfills this quarter and holding layoffs in reserve. A company that cuts now would have to rehire later from a workforce that, by Friel's account, is mostly staying put ^[12]. The slower path has its own cost, and it arrives next quarter. With quits retreating ^[19], a freeze keeps headcount close to flat. CBS News reported that a stable labor market gives the Fed more room to raise rates in the coming months ^[27]. A company that only freezes hiring still carries its full payroll into those higher borrowing costs.