U.S. stock futures edged lower on October 2, 2026, as investors braced for the September nonfarm payroll report. Economists predict the U.S. economy added 95,000 jobs during the month, slowing from August’s unexpected 162,000 increase while the unemployment rate is expected to hold steady at 4.1%.
September Hiring Is Expected to Moderate
Friday’s nonfarm payroll report is expected to show hiring moderated in September following a surprisingly strong August. Forecasters anticipate the United States added 95,000 jobs, representing a cooling from the unexpected 162,000 positions added the previous month, according to FactSet data cited by Morningstar. The unemployment rate is projected to remain unchanged at 4.1%, while average weekly hours are expected to tick slightly lower to 34.3 hours compared to 34.4 hours in August.
Economists suggest the incoming data will affirm a resilient yet sluggish labor market. Vanguard senior economist Adam Schickling observed that while the labor market is resilient, At best, it’s plateaued
with few signs of active improvement.
Hiring Trends Broaden Across Various Sectors
Oxford Economics expects a much weaker pace of government, leisure, and hospitality hiring compared to August, when seasonal adjustments inflated growth numbers. However, analysts point to signs of expansion across other sectors. Oxford Economics lead U.S. economist Nancy Vanden Houten noted that our September forecast implies little change in trend job growth overall,
with her firm projecting a 45,000-job increase that would lift the three-month moving average to 76,000.
Bank of America Securities economists added that the recent labor-market backdrop points to further broadening in hiring across industries in September. Meanwhile, Citigroup economists emphasize that wage growth will serve as the primary signal for underlying labor market tightness. Annual wage growth has steadily moderated, declining to 3.1% in August, while hourly earnings are forecast to register a steady 0.3% monthly increase in September.
High Borrowing Costs Weigh on Stock Futures
Ahead of the employment figures, U.S. stock futures traded slightly weaker as investors weighed stubbornly high borrowing costs. The 10-year U.S. government bond yield hovered near 4.8%, keeping mortgages, car loans, and corporate borrowing expensive. Factory activity scorecards also painted a mixed picture, with the S&P Global US Manufacturing PMI registering at 53.9 and the ISM US Manufacturing PMI at 54.6, indicating ongoing growth accompanied by slower new orders and higher costs.
Analysts note that Friday’s employment figures will likely carry less weight for the Federal Reserve’s upcoming October interest rate decision than mid-month inflation reports. Nevertheless, a soft jobs report could trim market confidence regarding the pace of additional rate hikes. As Kevin Warsh explained when discussing the central bank’s policy stance earlier this month, The labor side of the Fed’s congressional remit is in good shape,
leaving markets focused on how upcoming data will influence the broader rate trajectory.
