U.S. Adds 162,000 Jobs in August, Beating Forecasts
By Juliegrace Brufke | Quincy News Correspondent
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Washington (Quincy News) — U.S. employers added 162,000 jobs in August, roughly three times what forecasters expected, while the unemployment rate held at 4.1%, the Labor Department reported Friday.
About seven million people were unemployed, little changed from a year earlier. Economists polled by Dow Jones had expected 53,000 new jobs after softer private data earlier in the week.
The government also revised previous months higher. June’s gain was raised to 31,000, while July, initially reported as a loss of 23,000 jobs, was revised to an increase of 21,000. Together, the two months were 55,000 jobs stronger than previously reported.
Even with the jump in August, job growth has been much slower over the past year. Payrolls have risen an average of about 71,000 a month over the past three months and 31,000 a month over the prior 12 months.
Private employers added 127,000 jobs and the public sector 35,000. Food services and drinking places gained 59,000 jobs, local-government education 42,000 and manufacturing 16,000. The information sector lost 23,000 jobs.
A separate survey of households, which is used to calculate the unemployment rate, showed the number of employed people rose by 569,000 in August. The labor force grew by 683,000, pushing the labor-force participation rate up to 61.6%.
Workers also saw their pay increase. Average hourly earnings rose 10 cents to $37.75, up 3.1% from a year earlier. The average workweek increased by a tenth of an hour to 34.4 hours.
Markets reacted to the stronger report by increasing bets on a Federal Reserve rate increase this month. Treasury yields rose after the release, while stocks closed lower. The Dow Jones Industrial Average fell 0.5%, the S&P 500 declined 0.4% and the Nasdaq Composite lost 0.3%.
Short-term interest-rate futures put the probability of a quarter-point Fed increase in September at around 60%, up from roughly even odds a day earlier.
The federal funds rate has held at 3.50% to 3.75% since December 2025, with inflation staying well above the Fed’s 2% goal. The Federal Open Market Committee is scheduled to meet Sept. 15-16.
Fed Chair Kevin Warsh said at Jackson Hole on Aug. 28 that inflation was “more concerning” than labor-market conditions and that the Fed’s predominant focus should be on prices, leaving open the possibility of a rate increase.
Attention now turns to next week’s Consumer Price Index, which will give Fed officials another major reading on inflation before their September decision.
The September employment report will be released Oct. 2.
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