A Synchrony booth at the NC4ME hiring event for military veterans in Wilmington, North Carolina, US, on Wednesday, Oct. 28, 2026.
Allison Joyce | Bloomberg | Getty Images
The U.S. economy isn’t expected to have produced much job growth in October, with employers reluctant to hire workers but also not cutting staff amid a shrinking labor force and a growing problem of long-term unemployment.
Economists are looking for a meager nonfarm payrolls gain of 59,000, a slight uptick from the 29,000 jobs produced in September, according to the Dow Jones consensus. That result would continue a pattern of sparse growth.
But that’s kind of OK: The forecast also is that the unemployment rate will hold at a very low 4.2% rate, the product of a climate where a stagnant labor force reduces the need for outsized job increases to keep the jobless level steady.
“Long-term, we’re not going to need as many jobs added to the economy to have stable employment because we have fewer people who are available to work,” said Nicole Bachaud, labor economist at jobs site ZipRecruiter. “An aging workforce is pushing a lot of people into retirement. We have had decades of low birth rates, meaning we don’t have a lot of people who are coming in to replace those retiring workers. And immigration is now down pretty significantly, which is reducing some of that prime-age employment.”
Evaluating the health of the labor market in such a climate becomes a moving target, Bachaud said.
More clues will come Friday when the Bureau of Labor Statistics releases the October nonfarm payrolls report at 8:30 a.m. ET.
“Do we have an economy where we have a lot of productivity but not as many jobs? Do we start focusing on things like wage growth? Is that more of a signal, especially for lower-wage workers?” she said. “I think that’s the situation we’re in right now because we’re not going to go back to 200,000-plus jobs being added a month. That’s just not the the scenario that that we’re sitting in.”
Signs of strength and weakness
Indeed, payroll growth from January 2025 through September 2026 averaged just 35,000. There has been just one month during that period when gains topped 200,000 and seven months have seen losses.
Yet the unemployment rate has barely budged, up just 0.2 percentage point despite the marked slowdown.
During the period, though, the labor force has contracted by 434,000 and is down by just shy of a million since September 2025. The share of the labor force either working or looking for employment, known as the labor force participation rate, also has pulled back sharply, down to 61.8%, or a 0.8 percentage point slide.
But while hiring has been weak, other aspects show strength.
The level of layoffs has been meager, with initial jobless claims sliding to 189,000 last week, the lowest since July and hovering around the lowest level since 1969. Job openings also picked up by 333,000 in September, while the level of workers quitting their jobs — a proxy for confidence in being able to find new work — hit 3.36 million, its highest level in a year and a half.
Conversely, long-term unemployment has been a problem. The total number of workers out of a job for more than 25 weeks is up by 495,000 since January 2025, while the average duration of unemployment is at 24.8 weeks, an increase of 2.8 weeks, according to BLS data through September.
Federal Reserve officials generally consider the labor market as solid, but questions remain.
“If you have a job, you’re fine, right?” ZipRecruiter’s Bachaud said. “There’s not a lot of movement happening, but at least you’re employed. For people who are out of work because of the slowdown in turnover, people aren’t vacating their jobs, employers aren’t expanding and adding new jobs. That makes it very difficult to kind of break back in.”
