U.S. employers added just 29,000 jobs in September, unemployment rose to 4.2%, and consumer confidence fell to its lowest level since April 2014. Economists had expected about 90,000 new payroll jobs. The figures point to a weak labor market as households worry about prices, wages and borrowing costs.
Jobs and household costs
Labor Department revisions lowered the combined July and August job totals by 60,000. Average hourly wages rose 3% from a year earlier, the smallest year-over-year increase since May 2021. The New York Times reported that wages again failed to keep pace with consumer prices as Americans faced rising costs for gasoline, auto loans, credit cards and mortgages.
The Conference Board’s consumer confidence index fell 6.7 points, to 81.9 in September from 88.6 in August. That marked its lowest reading since April 2014, even below its lowest level during the pandemic. Respondents’ assessment of their present situation dropped 7.9 points to 109.3, while their short-term outlook slid 5.9 points to 63.6.
The Conference Board collected responses from Sept. 1-23. Respondents were mostly pessimistic and often cited the cost of gasoline, goods and services. The Associated Press reported that confidence had reached its lowest level in more than a decade as prices remained elevated and wages stagnated amid the Iran war.
Consumer prices rose 3.4% in August from a year earlier, below economists’ expectation of 3.7%, the Commerce Department said. Prices increased 0.3% month to month, compared with 0.1% in July. Excluding food and energy, prices climbed 3% year over year and 0.2% from July to August.
Mortgage costs added pressure. Freddie Mac said the average 30-year fixed-rate mortgage rose to 7.28%, from 7.03% the previous week. The average 15-year fixed-rate mortgage climbed to 6.60%, from 6.42%. A year earlier, those averages stood at 6.34% and 5.55%, respectively.
Spending, markets and policy
Households kept spending despite weak confidence readings. Consumer spending increased 0.9% in August from July, or 0.6% after adjustment for inflation, its strongest monthly gain since March 2025. Bank of America said its customers’ card spending showed Americans were “still ramping up their discretionary spending across both goods and services.” The Associated Press reported that consumer spending makes up about 70% of the U.S. economy.
The Commerce Department said the economy grew at a 2.2% pace from April through June, exceeding its previous estimate of 1.5%. Consumer spending grew at a 3.8% annual pace in the second quarter, up from 0.7% in the first. The Associated Press said a strong stock market, supported by enthusiasm about artificial intelligence, increased the resources of wealthy investors.
Job openings fell to 7.08 million in August from a revised 7.34 million in July, the Labor Department reported. The department’s survey found layoffs fell, quits changed little and hiring ticked up modestly. Ken Mahoney, chief executive at Mahoney Asset Management, called it a “‘low hire, low fire’ situation.” He said, “Companies are not adding many people, and they are not laying many off either.”
The Federal Reserve’s interest-rate decisions remain a focus of upcoming releases. Minutes from its most recent meeting were due Wednesday and could provide detail on its decision to raise interest rates and its views on inflation and the job market. The Institute for Supply Management’s September services-sector index was due Monday; services account for most U.S. economic activity.
President Trump described the economy as strong and said the missing element was “good public relations,” according to The New York Times. He campaigned for Republicans in Alabama, Oklahoma, Texas and Washington, emphasizing economic growth, financial markets and construction. His aides pointed to a burst of construction hiring in September. Overall hiring cooled, though, and the newspaper reported that his economic sales pitch wasn’t resonating.