US nonfarm payrolls rose by 165,000 in October 2026, far above the 65,000 expected in a Reuters poll, and revisions added 84,000 jobs to August and September. The unemployment rate fell to 4.1%, and markets raised the odds of a Federal Reserve rate rise in December to about 80%.
Global Economy Charts Research Desk | November 7, 2026
Key indicators
| Indicator | Reading | Context |
|---|---|---|
| Nonfarm payrolls | +165,000 | Reuters poll +65,000; September revised to +60,000 |
| Unemployment rate | 4.1% | September: 4.2% |
| Average hourly earnings | +0.4% m/m | +3.1% y/y, to $38.00 |
| Participation rate | 61.9% | September: 61.8%; August: 61.6% |
| U-6 underemployment rate | 7.9% | September: 7.6% |
The three-month average gain rose to 137,000, compared with an average of 48,000 a month over the past year. August was revised up to 186,000 from 133,000 and September to 60,000 from 29,000. Private employers added 159,000 jobs. The household survey showed employment up 463,000 and the labour force up 421,000, which helped pull the unemployment rate down despite higher participation.
1. Broad gains led by services
Professional and business services added 70,000 jobs, including 18,600 in temporary help, which is often an early signal of hiring demand. Health care added 41,600 and social assistance 13,500. Transportation and warehousing rose by 24,800, led by couriers. Manufacturing added 19,000 and is up 101,000 from its December 2025 low. Leisure and hospitality lost 13,000, construction 3,000 and wholesale trade 9,100. The diffusion index rose to 57.6, showing gains spreading across industries.
2. Slack has not disappeared
Not every measure improved. The U-6 rate, which includes people working part time for economic reasons, rose to 7.9% from 7.6%, as involuntary part-time work increased by 339,000 to 4.84 million. Long-term unemployment stood at 1.96 million, or 27.6% of the unemployed. Reuters reported that the median duration of unemployment reached its longest since November 2021, and that many labour-force entrants were people returning to work.
3. Wages trail inflation
Average hourly earnings rose 0.4% in the month to $38.00, an annual gain of 3.1%. Average weekly hours were unchanged at 34.4. With consumer price inflation above 3.5% in September, according to Reuters, real hourly pay is falling. October CPI is due on 10 November. Estimates of the payroll growth needed to keep unemployment stable vary widely after lower immigration, from about 5,000 a month (Yale Budget Lab, cited by AP) to at least 40,000 (Reuters).
4. A December Fed rise looks more likely
The Federal Reserve held its target range at 3.75% to 4.00% on 28 October, with two officials favouring an increase. After the report, CME FedWatch implied about an 80% chance of a December rise, up from about 67% on Thursday, according to Reuters. The two-year Treasury yield rose about 6 basis points to 4.52% and the 10-year about 3 basis points to 4.87%, while the dollar gained about 0.7%.
Scenarios to watch
If October’s strength reflects temporary factors such as government and election-related spending, as some economists argued, hiring could slow again and the December decision would become closer. If the November report on 4 December confirms the upturn while inflation stays high, a rise at the 8-9 December FOMC meeting would look more likely. These are scenarios for monitoring, not forecasts.
Sources and methodology
BLS, The Employment Situation – October 2026, 6 November 2026; BLS, Table B-1, employment by industry; FRED, total nonfarm payrolls (PAYEMS); FRED, unemployment rate (UNRATE); Federal Reserve, FOMC statement, 28 October 2026; Reuters, 6 November 2026; CNBC, 6 November 2026. Reported figures are distinguished from forecasts and GEC calculations. Charts use the values and units shown; scales start at zero except where negative values or index thresholds require otherwise. Interpretive sections are GEC analysis, not company or central-bank forecasts.
Thumbnail: AI-generated editorial illustration. Figures are rounded for readability; some releases may be preliminary or subject to revision.
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