Weekly Economic Trends and Indicators
The Headlines:
Total nonfarm payroll employment in the U.S. increased by 119,000 jobs in September according to the Bureau of Labor Statistics (BLS), which exceeded expectations. Job growth for July and August was revised downward by a total of 33,000, bringing the revised job growth numbers down to +72,000 for July and -4,000 for August. The unemployment rate increased slightly from 4.3% in August to 4.4% in September.
The Details:
As we noted in early September (the last time we had any official reading on the U.S. labor market), growth in private service-providing employment (+87,000) continues to outpace growth in goods-producing employment (+10,000). Manufacturing lost 4,000 jobs in September, which were spread across nearly every category.
However, even within the private service-providing sector, the job gains were concentrated mainly in health care and social assistance (+57,100) and leisure and hospitality (+47,000). Transportation and warehousing (a complementary service to the goods-producing sector) decreased by 25,300 workers in September. Professional and business services decreased by 20,000 workers. Other private service-providing categories were mostly flat.
The Context:
The current labor market has been characterized by some as “no-hire, no-fire.” While layoff activity has been subdued for most of 2025, it has also become more difficult for people to find new jobs because of low hiring activity. As we have documented in this blog over the last several months, overall economic activity remains strong. GDP forecasts for the third quarter (for which data was delayed by the government shutdown) indicate that many sectors of the economy continue to see robust growth. The economy has shown remarkable resilience to significant headwinds over the last year.
Even so, a “no-hire, no-fire” labor market is not healthy in the long run. This is why analysts are watching very closely for any sign of change. Unemployment insurance weekly claims are a good place to look for any problems in the labor market.
Initial claims were down slightly for the week ending November 15. However, four of the seven states experiencing the highest increase in initial claims (MI, MN, PA, and TX) noted that it was due to layoffs in specific industries. Also, continuing claims were up 28,000 to 1.974 million for the week ending November 8. This was the highest level for continuing claims since November 2021 when the economy was still recovering from the COVID-19 recession.
This explains why the labor market continues to be a point of concern and a subject of much discussion. Could it be enough to move the Federal Reserve to cut their policy rate again? The market’s estimated probability of a rate cut increased slightly since the latest labor market news.
Next week: Catching up on delayed economic data (continued)
