U.S. Economy Adds 165,000 Jobs in October as Unemployment Rate Slips to 4.1%

The U.S. economy added 165,000 nonfarm payroll jobs in October, and the unemployment rate edged down to 4.1% from 4.2% a month earlier, federal data released Friday showed. The payroll increase was well above the average monthly gain of 48,000 over the preceding 12 months, marking a stronger month for hiring after an uneven stretch.

Professional and business services supplied the largest share of the new positions, with sizable contributions from health care and transportation and warehousing. Manufacturing also added workers. Employment was little changed in many other major industries, however, making the sector-by-sector picture more restrained than the headline total alone might suggest.

The Bureau of Labor Statistics also raised its estimates for August and September payroll growth by a combined 84,000 jobs. A separate household survey offered a less uniformly positive picture: More Americans were working part time for economic reasons, despite the slight decline in the unemployment rate.

Business services and health care lead October hiring

The October employment report showed that professional and business services added 70,000 jobs, far above the sector’s average monthly gain of 15,000 over the previous year. Professional, scientific and technical services accounted for 33,000 of those positions. Administrative, support, waste-management and remediation services added 28,000, while company management added 9,000.

Health care added 42,000 jobs, exceeding its average gain of 31,000 over the prior 12 months. Hospitals hired 16,000 additional workers, home health care services added 11,000, and outpatient care centers gained 5,000. The figures suggest that health care remained a dependable source of hiring even as job growth elsewhere fluctuated.

Transportation and warehousing employment increased by about 25,000, including 17,000 positions in courier and messenger services and 4,000 in air transportation. The industry has added 104,000 jobs since a recent low in February, according to the BLS, with courier and messenger employment contributing most of that increase.

Manufacturers added 19,000 jobs in October. Computer and electronic product manufacturing gained 7,000 positions, while machinery producers and primary metals manufacturers each added 4,000. Manufacturing has gained 101,000 jobs since a recent low in December 2025, although the latest monthly growth was concentrated in particular segments of the industry.

The rest of the report was less dynamic. Construction, retail trade, information, financial activities, leisure and hospitality, and government all showed little change in employment. Private employers accounted for 159,000 of October’s overall increase, compared with a gain of 6,000 government jobs. That distinction matters when assessing how broadly businesses are expanding their payrolls.

Unemployment edges lower as part-time work rises

The unemployment rate fell by one-tenth of a percentage point to 4.1%, but the BLS described the rate and the number of unemployed people as little changed. Roughly 7.1 million people were unemployed in October. Since March, the jobless rate has remained within a narrow 4.1% to 4.3% range, putting the latest decline in perspective.

Labor force participation was 61.9%, compared with 61.8% in September. The employment-to-population ratio rose to 59.3% from 59.2%. Neither measure has shown much net movement since January, according to the report. Participation tracks the share of people working or seeking employment, while the employment ratio measures the share of the population that has a job.

One less favorable measure was the number of people working part time for economic reasons. That group increased by 339,000 to 4.8 million. It includes employees who would prefer full-time work but are getting fewer hours because business conditions have reduced their schedules or because they cannot find full-time positions. The rise points to pressure that is not fully reflected in the official unemployment rate.

Long-term unemployment remained near 2.0 million, or 27.6% of the unemployed population. Another 6.0 million people outside the labor force said they wanted a job, but they were not classified as unemployed because they had not actively searched in the preceding four weeks or were unavailable to work. Those distinctions help explain why a small monthly decline in unemployment does not mean every measure of labor-market conditions improved.

The payroll and unemployment figures are drawn from different surveys. The establishment survey asks employers about jobs, hours and earnings; the household survey measures whether people are employed or looking for work. Their monthly changes need not match, so October’s payroll gain and the household survey’s findings are best read together rather than treated as interchangeable estimates.

Wages advance, and earlier payroll estimates move higher

Average hourly earnings for private-sector employees rose 14 cents, or 0.4%, in October to $38.00. Pay was 3.1% higher than a year earlier. Among production and nonsupervisory employees, hourly earnings rose 12 cents, also a 0.4% monthly increase, to $32.75. These are wage figures before accounting for changes in consumer prices, so they do not by themselves establish whether purchasing power improved.

Working hours were comparatively steady. The average private-sector workweek remained at 34.4 hours. In manufacturing, the workweek held at 40.5 hours, although overtime edged up to 3.1 hours. Hours worked are an important part of the pay picture because weekly earnings depend on both the hourly rate and the number of hours employees are scheduled.

The revisions to earlier employment reports were substantial. August payroll growth was increased by 53,000 to 186,000, from an earlier estimate of 133,000. September was revised upward by 31,000 to 60,000, compared with the previously reported 29,000. Together, the two changes raised the earlier job totals by 84,000. BLS revisions reflect additional responses from employers and updates to seasonal calculations.

With those revisions included, payroll gains averaged 137,000 a month over August, September and October. That three-month pace is above the 48,000 average for the previous 12 months, although the figures still show meaningful month-to-month variation. October’s estimate is preliminary and may itself change as more payroll records become available.

The next national employment report is scheduled for December 4 at 8:30 a.m. Eastern Time. It will provide November payroll and unemployment figures and an updated reading of the recent hiring trend.