Was It a Good Jobs Report or a Bad One?

There is much that is confusing about the job numbers in the latest Employment Situation. By conventional standards, as is often the case, official unemployment was on the low side–just 4.2%. And from a separate report, we learn that initial applications for unemployment benefits have recently been on the low side although not by much.

However, the official unemployment report included bad news. While the unemployment rate for whites was low at 3.6%, the rate for blacks was 7% and for black teens it was horrific at 19.9%. More broadly, when we at the National Jobs for All Network include as unemployed those who want jobs but have not searched lately, and part-timers who want full-time employment, the real unemployment rate is 9.9%. Not great.

As we probe the numbers, there seem to be more puzzles than usual. Over the past year (September through September), the number of workers and job-seekers, that is, the labor force, fell by a million. Yet the adult population, as measured by the government, grew by almost 1.3 million. More people, fewer in the labor force: the total number of people who are employed or looking for work is way down. We have fewer people with jobs but also fewer who are searching for work and are thus counted as “unemployed.” The number of adults who are on the sidelines, neither working nor looking for work, jumped by 2.3 million. A huge jump. One reason must be that the assault on immigrant communities forced hundreds of thousands to hide out or run away.

Back to the basic issue. The low official unemployment rate in the government’s household survey does not yield a sufficient estimate of the health of U.S. labor markets. Information from a government survey of non-farm employers—the Establishment or Payroll Survey—may be more realistic. It does not measure unemployment, but it is a larger sample of people. What it has shown in the last couple of years is not encouraging. Just 29,000 jobs were added last month. And ongoing revisions as more information comes in has cut the job additions we thought we had in previous months. In last five months there was just one month that saw at least 100,000 job additions. And the last two years have not been very good: 17 months with losses or gains of fewer than 100,000. From September of 2025 through September of 2026, we added just 496,000 non-farm jobs. Looks like a lot, but it is not so much for our big economy. By the way, and not to be partisan, but in the last year of the presidential term of that other guy, from September of 2023 through September of 2024, we added almost 1.5 million non-farm jobs.

II.

Meanwhile, there is a scary new actor going after our jobs. It is called AI. AI is perhaps the most dynamic force in the American economy, and it is getting more powerful and more invasive every day. It is even beginning to take over the care-and-sympathy business. It accounts for a growing quantity of investment and consumption spending. But it is designed to kill jobs and it is doing so. It looks like the Devil to me. It is possible that its long-term impact on job creation will not be as bad as I fear. After all, we went through and are probably always in some parts of the economy in a process of going through what we used to call “automation.” But this time it looks like the impact will be much more abrupt and more antithetical to job creation. We will get economic growth, but with fewer jobs than in the past.

It may be happening already. The U.S. economy grew at 2.5% and 2.2% in the first and second quarters of the year. Those are fairly good rates. But as I showed above, job growth has been tepid.

And a little more bad news. Inflation is on the rise again and real wages fell in six of the last ten months. The rise in prices could inspire the Federal Reserve to raise interest rates again in the fight against inflation. That might slow job creation and even instigate a recession.

III.

Gloom, gloom, gloom. Can’t we find any bright spots? If we lengthen our field to more than just the last few months or year, we find that job growth in some sectors has been pretty good. Below are numbers about job increases and decreases in key sectors from January 1 of 2022 to the present. This information comes from an October 2 New York Times online publication of dozens of mostly brief comments by reporters on the unemployment report. Two reporters, Keith Collins and Jacqueline Gu, supplied more than a brief comment, and here is part of what they offered.

Four sectors that had the largest job additions
Health Care and Social Assistance                                        3.8 million
Leisure and Hospitality                                                           1.6 million
Government                                                                                1.3 million
Construction                                                                            0.769 million
Total                                                                                        7.5 million

Four sectors that added few jobs
Mining and Logging                                                                 29,000
Manufacturing                                                                           88,000
Retail trade                                                                                 51,300
Utilities                                                                                         61,100
Total                                                                                      229,400

One sector that lost jobs
Information                                                                          -245,000

What conclusions can we draw from these numbers? That we should subsidize and focus on job growth in lagging sectors, and especially on those that are linked to manly ideologies and blue-collars? That we should reward sectors that have proven that they can create millions of jobs? Should we try to limit investment in AI? It is annihilating its own labor force and is threatening jobs in many areas of the economy.

I think that meaningful limits on AI investment would be a grand idea. But it seems unlikely.  But at the very least, owners of new data centers ought to pay heavily to surrounding communities for the huge amounts of energy and water that they are grabbing, and they should have to contribute bigly to government programs for good-job creation. Sounds utopian, but we ought to be making major efforts to create more good jobs in the public and private sectors—and especially jobs that make our society more humane and livable. Rather than chasing an image whose subtext is manly work (mining, manufacturing), or investing so much in AI, which brings fewer jobs and more income inequality, we should focus federal policy on creating jobs in the public and private sectors that pay average workers well. And especially jobs whose outcomes make life better not only for the workers but for those that they serve. More clean energy projects rather than fewer. More low-income housing units and assisted living projects. Child-care and Head Start available and affordable for all. And no more federal job cuts.

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