U.S. employers add 162,000 jobs in August

U.S. hiring accelerated sharply in August, with employers adding 162,000 jobs and the unemployment rate holding steady at 4.1%, a stronger-than-expected report that showed renewed momentum in the labor market.

The gain far exceeded forecasts. Economists surveyed by Dow Jones had expected 53,000 new jobs, NBC News reported, while economists polled by FactSet had forecast 65,000, according to CBS News. The August increase also marked a sharp improvement from July, when hiring was initially reported as a loss before revisions showed a gain.

The Labor Department revised previous months higher. June was revised up by 11,000 jobs to a total gain of 31,000, according to NBC News. CBS News reported that, accounting for revisions, 11,000 jobs were added in June and 21,000 in July. NBC reported that July, previously recorded as a loss of 23,000 jobs, was revised up by 44,000 to show a net gain of 21,000.

The largest gains came from sectors tied to services and education. Restaurants and bars added 59,000 jobs, while local government education gained 42,000 as teachers returned to school. Construction employment rose by 22,000. Payroll gains in August were more than five times the monthly average for the past 12 months, which was 31,000, according to the Labor Department figures cited by CBS News.

“What a ‘wow’ jobs report,” Heather Long, chief economist at Navy Federal Credit Union, said in an email cited by CBS News. “The hiring rebound in education was expected as teachers head back to work, but it was encouraging to see the bounce back in hospitality as well, especially restaurants.”

Not every sector expanded. Information technology employment fell by 23,000 in August. The Bureau of Labor Statistics said those losses occurred at companies that provide computing infrastructure, data processing and web hosting, NBC News reported.

The report could affect expectations for the Federal Reserve’s next move. Economists said the stronger hiring data may bolster the case for an interest rate increase when the central bank announces its decision on Sept. 16, though the inflation report due Sept. 11 is likely to carry significant weight.

“An upside surprise in payrolls will likely ramp up concerns about a rate hike, but that outcome is in the hands of next week’s inflation numbers,” Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management, said in an email cited by CBS News. “If those come in cooler than expected, the Fed will likely feel comfortable discounting potentially inflationary signals coming out of the labor market.”

Wells Fargo’s Jennifer Timmerman said the report showed strength but also raised concerns about inflation. “August’s blowout jobs report provided evidence of a stable labor market heading into the fall, supporting resilient consumer spending but also raising market expectations for a near-term Fed rate hike amid unacceptably high inflation,” she said.

Wages remained another pressure point. Average wage growth was 3.1% from a year earlier in August, unchanged from July. Timmerman called that “the fly in the ointment,” adding that “with oil prices poised to nudge inflation higher, real wages remain vulnerable during the balance of the year.”

Inflation was 3.4% in July from a year earlier, before energy prices began rising again. Brent crude traded around $95 a barrel Friday and had climbed nearly 20% since Aug. 4, NBC News reported. If August inflation rises from July, the gap between wage growth and prices would widen.

Economists also cautioned that August jobs figures are often revised because of seasonal factors. Average job growth so far this year is tracking at 80,000 a month, NBC News reported, above 2025’s 10,000 average but below the averages in 2023 and 2024.