US employment: A swing toward the better
Summary
- US employment figures for August exceeded expectations with 162,000 new jobs, compared to a consensus estimate of 53,000, while the unemployment rate remained steady at 4.1%.
- The strong employment data increased market expectations for a Federal Reserve rate hike, leading to a rise in the two-year yield.
- Despite the positive job growth, real wages are stagnating as hourly wages increased by 3.1% year-on-year, slightly below the July inflation rate of 3.4%.
- Upcoming consumer price figures will play a crucial role in shaping the Fed's monetary policy decisions, potentially more so than employment data.
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Automatic translation: Originally published in Finnish 07/09/2026, 04:37 GMT. Give feedback here.
Last week was a down week on the European stock market, but in the US, the S&P 500 pushed narrowly into positive territory despite Friday's decline. US employment figures continue to be closely watched and came in stronger than expected, but at the same time they bolstered expectations of Fed rate hikes, paradoxically sending indices lower.
| Indexes | close | change 1 wk | YTD | |
| OMX Helsinki | 13688,3 | -0,8 % | 10,2 % | |
| Eurostoxx 600 | 649,9 | -0,8 % | 9,7 % | |
| S&P500 | 7718,6 | 0,1 % | 12,8 % |
US employment figures for August offered a clear positive surprise on Friday. The economy created 162,000 new jobs, while the consensus estimate was of around 53,000. The unemployment rate remained unchanged at 4.1%, which continues to point to near-full employment. The figures for June and July were also revised upwards: July turned from negative to positive, and June's growth nearly increased by half. However, job revisions have fluctuated wildly recently. On an annual basis, an average of 80,000 jobs have been created per month, which is significantly more than the monthly pace of around 10,000 in 2025.
US: Unemployment rate and non-farm payrolls
Lähde: LSEGThe strong employment report simultaneously removes a key argument for postponing a rate hike: a weak labor market is no longer as strong a rationale for keeping monetary policy unchanged. The markets reacted by raising their expectations for a rate hike at the next Fed meeting, and, for example, the two-year yield rose clearly.
US: Bond yields, %
Source: LSEG
Inflation remains a key variable for the central bank. Next Friday's consumer price figures will ultimately determine the Fed's stance more than the employment figures. At the same time, real wages are stagnating near zero, as hourly wages rose by 3.1% year-on-year, while inflation in July was 3.4%. This, combined with rising gasoline prices, puts pressure on consumer pockets and may contribute to cooling the economy.
