Publication Date: 20.11.2025
Overview
- Author: Siegmund Skalar
- Source: FuW
- Date: 20.11.2025
- Estimated Reading Time: 4-5 minutes
Summary
The US labor market in September shows a contradictory picture: Despite surprisingly strong 119,000 new jobs, unemployment rises to 4.4% - the highest level since October 2021. These mixed signals make the Fed's December interest rate decision considerably more difficult.
- 119,000 new jobs in September significantly exceed expectations (forecast: 55,000)
- Unemployment rate reaches 4.4%, highest level since October 2021
- Job creation concentrated almost exclusively in hospitality (+47,000) and healthcare (+57,000)
- Professional Services (-20,000) and logistics (-25,000) cut jobs
- Financial sector and IT industry stagnate in job development
- Revision of previous month's data downward by 33,000 jobs
- Fed interest rate decision on December 10 occurs without additional labor market data
Opportunities & Risks
Opportunities
- Hospitality and healthcare sectors show continued resilience
- Surprisingly positive job numbers indicate remaining strength
- Possible Fed rate cut could provide additional support to labor market
Risks
- Unemployment continues to rise despite job creation
- Job cuts in important economic sectors like Professional Services
- Wave of federal employee layoffs (approx. 125,000 positions) expected from October
- Weakness signals in key sectors like finance and IT
Future Outlook
Short-term (1 year): The labor market is likely to remain volatile, characterized by sectoral differences and uncertain Fed policy. The wave of civil servant layoffs will burden the statistics.
Medium-term (5 years): A possible concentration on few robust industries could lead to structural shifts. Monetary policy will be crucial for stabilization.
Long-term (10-20 years): Demographic trends and technological change will likely amplify today's observed industry differences and create new labor market structures.
Fact-checking
Well-documented: All labor market data comes directly from the US Bureau of Labor Statistics (BLS). The figures for job creation and unemployment rate are officially confirmed.
Lack of transparency: The exact reasons for the contradictory signals remain unclear. The impact of civil servant layoffs is also not yet fully measurable.
Brief Summary
The US labor market is sending contradictory signals with strong job creation alongside rising unemployment. This uncertainty makes the Fed's December interest rate decision a difficult balancing act between fighting inflation and protecting the labor market. A wait-and-see approach by the central bank appears most likely given the unclear data situation.
Three Key Questions
Freedom: How free are workers in their career choices when new jobs are concentrated only in few sectors like hospitality and healthcare?
Responsibility: Does the Fed bear responsibility for making an interest rate decision despite incomplete data that affects millions of jobs?
Transparency: Why are important labor market data missing at the time of critical monetary policy decisions, and how can this information gap be avoided in the future?