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U.S. economy adds 162,000 jobs in August, unemployment rate at 4.1%
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Sept. 4, 2026, 5:00 AM EDT / Updated Sept. 4, 2026, 9:50 AM EDT
The U.S. economy in August added 162,000 jobs, far more than expected. The unemployment rate remained unchanged at 4.1%.
Economists surveyed by Dow Jones had expected overall hiring of just 53,000 roles and a steady unemployment rate.
Meanwhile, employment for June was revised up by 11,000 roles to a total addition of 31,000. July, which had previously been recorded as a negative 23,000, was revised up sharply by 44,000 to a total net job additions of 21,000.
Taken together, the strong August number and the upwardly-revised June and July numbers will give economists significant added confidence in the stability of the labor market.
“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,” Wells Fargo’s Jennifer Timmerman said.
Wage growth, which has been another problem for workers, was 3.1% year-over-year in August. That was 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.”
The payrolls number also slightly increased market odds for a September rate hike by the Federal Reserve, however most market watchers still believe that next week’s inflation report will prove to be pivtol.
On the other hand, President Donald Trump took to social media, writing that the report was “great,” and as a result he called for the Fed to “lower the interest rates” immediately. Trump added that the Fed and his newly-installed chairman Kevin Warsh “must get smart” and “be patriots.”
The Fed is widely expected to raise rates before the end of the year due to rising energy prices as a result of the wars in Iran and Ukraine and continued trade tensions.
Among the sectors that saw job growth during the month, employment at restaurants and bars rose by 59,000, while the local government education sector gained 42,000 as teachers returned to school.
The construction sector also gained 22,000 roles.
However, information technology employment declined by 23,000 in August. In that sector specifically, the Bureau of Labor Statistics said that job losses occurred at companies that provide computing infrastructure, data processing and web hosting.
The ongoing lag between wages and inflation also comes at a difficult time for U.S. consumers, especially those in lower income tiers.
The inflation rate in July was 3.4% from a year ago, but that was before energy prices started climbing again.
On Friday, the international crude oil benchmark Brent traded around $95 per barrel. Since Aug. 4, the price of Brent has risen nearly 20%.
August inflation data won’t be released until Sept. 11. But any uptick from July would widen the gap between wage growth and rising prices.
While Friday’s data looked positive at first glance, economists cautioned that due to seasonal factors, the month of August often faces revisions to its employment data later in the year.
Revisions are a normal part of the process when BLS compiles the report each month. They typically stem from fresh data the agency receives from businesses about their hiring and payrolls that arrives too late to be included in that month’s initial reading.
August’s number is likewise not reflective of job growth writ large this year, which is tracking at about 80,000 roles per month. That’s well above 2025’s monthly average of 10,000 jobs, but below the monthly means for 2023 and 2024.
