Jobs Data Disappoints: Unemployment Rises To Over 4-Year Highs (UPDATED)

Editor’s Note: This story has been updated to include the latest data and market reaction.

The U.S. labor market showed clearer signs of cooling in November, as job growth broadly met already subdued expectations while the unemployment rate rose more than anticipated, intensifying concerns that the slowdown is becoming more fragile.

Nonfarm payrolls increased by 64,000 in November, only slightly above the 50,000 jobs expected by economists, but still well below levels typically associated with a healthy pace of job creation, the Bureau of Labor Statistics reported Tuesday.

Private-sector hiring remained a bright spot, with 69,000 private payrolls added, comfortably above expectations of 40,000.

“Employment rose in health care and construction,” the BLS stated. Health care added 46,000 jobs, while payrolls in construction increased by 28,000.

Transportation and warehousing employment declined by 18,000, reflecting losses in couriers and messengers, while payroll trends across other industries remained largely unchanged.

Government Layoffs Sharply Rose During Shutdown

The overall rise in private payrolls, however, was offset by a 5,000 decline in government employment, which continued to weigh on the headline number following shutdown-related distortions earlier in the fall.

The unemployment rate rose unexpectedly to 4.6%, up from 4.4% in September, marking its highest level since September 2021.

Wage growth also softened. Average hourly earnings rose just 0.1% month-over-month, missing the 0.3% forecast, while the year-over-year pace slowed to 3.5%, down from 3.7% in October.

October nonfarm payrolls fell by 105,000, reversing September’s 108,000 gain, largely due to 157,000 job losses in the government sector, even as private payrolls rose by 52,000.

The Bureau of Labor Statistics also revised prior data lower. August payrolls were revised down by 22,000, from a negative 4,000 to a negative 26,000, while September payrolls were revised down by 11,000, from 119,000 to 108,000.

The cooler labor market reading may push traders to reconsider how long the Federal Reserve can afford to stay on hold.

Prior to the data, markets were pricing only a 25% probability of a fourth consecutive 25-basis-point rate cut in January 2026, as Fed Chair Jerome Powell recently underscored that policymakers are “well positioned” to wait for clearer signals.

However, the ongoing deterioration in labor conditions could begin to strain that patience.

Market Reactions

Fed funds futures quickly adjusted after the release, with markets pricing in about a 30% chance of an interest rate cut at the January meeting.

In premarket New York trading, U.S. equity indices erased early futures gains, as the cooler-than-expected jobs data raised fresh questions about the resilience of the U.S. consumer heading into the final stretch of the year.

Nasdaq 100 futures slipped 0.2%, weighed down by losses in Broadcom Inc. (NASDAQ:AVGO) and Palantir Technologies Inc. (NASDAQ:PLTR).

Gold edged 0.1% higher, extending its advance as it battles for a fourth consecutive positive session.

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Originally Posted December 16, 2025 – Jobs Data Disappoints: Unemployment Rises To Over 4-Year Highs (UPDATED)