US adds 162,000 jobs as unemployment holds steady

The U.S. economy added 162,000 jobs in August, a stronger-than-expected rebound after a weak summer for hiring and a report that sharpened attention on the Federal Reserve’s next move on interest rates.

The unemployment rate was unchanged at 4.1%, according to Bureau of Labor Statistics data released Friday. The rate remains below its recent peak of 4.5% last November, even as monthly job growth has swung sharply this year, from 214,000 in March to a revised gain of 21,000 in July and then back up in August.

The August total exceeded forecasts cited by several outlets. Economists polled by Reuters had expected 56,000 jobs, while The Wall Street Journal forecast 53,000 and Bloomberg forecast 55,000. The Guardian reported that economists had predicted gains of at least 50,000.

The government also revised earlier figures higher. June job growth was revised to 31,000 from an initial estimate of 20,000. July was revised up by 44,000 jobs, changing an initially reported loss of 23,000 into a gain of 21,000.

Hiring was led by local government education and food services. Public schools added nearly 42,000 jobs as the 2026–27 school year began across much of the country, Al Jazeera reported, noting that teachers typically fall off payrolls during summer months when school is not in session. Food services added 59,000 jobs from July. Construction added 22,000 jobs, and healthcare added 12,000.

Other sectors lost ground. The information sector, which includes data processing, web hosting, publishing, broadcasting and telecommunications, fell by 23,000 jobs, with Al Jazeera citing notable layoffs at companies including Scripps TV and Zillow. Financial activities, including insurance, commercial banking and real estate, declined by 12,000.

The report contrasted with other recent labor market data. Payroll firm ADP said private companies added 38,000 jobs in August, below expectations and the lowest monthly gain since January, according to The Guardian. Challenger, Gray & Christmas reported that layoffs have been declining and are 41% lower than cuts announced by the same point last year.

The Labor Department’s Job Openings and Labor Turnover Survey showed little change in July. Job openings were 7.3 million, up from 7.2 million in June, while total separations fell to 5.1 million from 5.3 million, Al Jazeera reported. The Guardian reported that job openings and layoffs had changed little and that quits remained flat, a sign workers may feel less confident about finding another job.

Economists have described the labor market as stuck in a “slow hire, slow fire” pattern, with neither rapid job growth nor broad job losses.

The data arrived as inflation continues to weigh on households and policymakers. The Guardian reported that U.S. inflation has risen since the start of the war with Iran, with the annual rate increasing from 2.4% in February to 3.4% in July. In May, price increases reached 4.2%, the highest rate since 2023. Treasury yields have also risen since the start of the Iran war, a move that could raise borrowing costs for mortgages, car loans and student debt.

Economists expect at least one Federal Reserve interest rate increase before the end of the year, The Guardian reported. CME Group’s FedWatch showed a 60% chance of a 25-basis-point increase to a range of 3.75% to 4.00% after the jobs report, up from 49% on Thursday, according to Al Jazeera.

Fed Chair Kevin Warsh said last week at the Fed’s symposium in Jackson Hole, Wyoming, that the central bank remained committed to bringing inflation down to its 2% target. “We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed,” he said. “Otherwise, we have work to do.”

President Donald Trump celebrated the jobs figures Friday while pressing the Fed to cut rates. “Lower the interest rates because the U.S.A. is a much stronger credit than it was a short time ago!” he wrote on Truth Social. He also threatened to “stop trading with countries with which we have a deficit” if the Fed does not lower rates. “A STRONG COUNTRY MEANS A LOWER INTEREST RATE –IT’S A BETTER CREDIT… Very simple!” Trump wrote. “We should have the LOWEST RATE of any country in the World, like ‘the old days’.”

U.S. markets moved lower after the report and Trump’s comments, Al Jazeera reported, with the Nasdaq down 0.2%, the Dow Jones Industrial Average down 0.5% and the S&P 500 down 0.3%.