US manufacturing added 9,000 jobs in September, a slowdown that came as overall US employment growth also weakened. According to data released on 2 October by the US Bureau of Labor Statistics (BLS), the September increase was 40% below the revised 15,000-job gain recorded in August and slightly below economists’ consensus forecast of 10,000 jobs.
The slowdown in manufacturing hiring came alongside weaker-than-expected growth in total US non-farm payrolls, which increased by 29,000 in September. The increase was well below forecasts of about 90,000 jobs, while the unemployment rate rose to 4.2%. Manufacturing nevertheless recorded employment growth while several other sectors reported job losses.
Durable goods drive manufacturing employment gains
BLS data show a divergence between durable and non-durable goods manufacturing. The overall increase was driven by durable goods manufacturing, while employment in non-durable goods manufacturing declined.
Since January, manufacturing employment has increased by a net 72,000 jobs, comprising a gain of 101,000 jobs in durable goods manufacturing and a decline of 29,000 in non-durable goods manufacturing.
The pattern continued in September, with machinery employment increasing by 4,500 jobs and plastics and rubber products manufacturing adding 4,600. Susan Spence, chair of ISM’s Manufacturing Business Survey Committee, noted that only the computer and electronic products and transportation equipment industries, among the six major manufacturing industries, reported higher employment levels.
The employment gains are concentrated in several durable goods industries, although the BLS figures do not by themselves establish a direct link to long-term investment.
Conversely, several manufacturing industries reported a decrease in employment in September. These included textile mills; printing and related support activities; petroleum and coal products; paper products; food, beverage and tobacco products; and chemical products. The paper sector lost about 2,600 workers. The divergence shows that employment gains were concentrated in some durable goods industries, while several non-durable goods industries recorded declines.
Despite slower net hiring, the number of unemployed manufacturing workers fell by nearly 26% year on year, from 571,000 in September 2025 to 423,000 in September 2026. The decline in unemployed manufacturing workers occurred despite the slower pace of employment growth.
Labour market indicators send mixed signals
While manufacturing employment growth has slowed, other labour-market indicators point to continued demand for workers. Manufacturing job openings increased by nearly 26% year on year in August to 522,000, according to the latest Job Openings and Labor Turnover Survey (JOLTS).
The difference between the number of job openings and the pace of hiring may reflect challenges in matching available workers with vacancies, although the figures do not identify the cause.
The ISM’s latest Manufacturing PMI also showed an increase in its Employment Index, which rose to 52.7 in September from 51.2 in August. According to the ISM, an Employment Index reading above 50.3 generally corresponds with an increase in BLS manufacturing employment. The focus on additive manufacturing innovations and other advanced processes continues to drive demand for specialised talent.
Susan Spence, chair of ISM’s Manufacturing Business Survey Committee, said the ratio of hiring to layoff comments from survey panellists was 1.5 to 1. The ratio indicates that hiring-related comments outnumbered layoff-related comments among survey respondents.
Stability was also seen in the average manufacturing workweek, which held steady at 40.6 hours, with overtime also unchanged at 3.0 hours. The stable workweek indicates that average hours worked in manufacturing were unchanged during the month.
Broader economic context and lingering threats
The manufacturing sector’s performance cannot be viewed in isolation. The slowdown in overall US job creation, together with downward revisions totalling 60,000 jobs for July and August, points to weaker employment growth. Employment declined in professional and business services by 9,000, information by 10,000, and financial activities by 7,000.
Scott Paul, president of the Alliance for American Manufacturing (AAM), stated, “Manufacturing’s slow but steady job growth since the beginning of the year has been a real bright spot.
Even though factory construction has cooled a bit since its peak, that investment is converting into job opportunities, and it should continue to do so for years to come.” Paul linked the manufacturing employment gains to continued investment in industrial facilities.
The report also highlighted concerns about inflation and global economic conditions. Inflation remains a concern for manufacturers, according to industry representatives. Susan Spence of the ISM said inflation and global economic conditions continue to affect US manufacturers.
China’s industrial overcapacity and policy concerns
Looking ahead, industry advocates are increasingly focused on geopolitical risks. Paul stated, “The biggest threat to manufacturing is China’s massive industrial overcapacity, which is already shocking the European Union.
Steel, autos, microelectronics — you name it — China is coming for these jobs; it’s up to Congress and the Administration to defend our industries.” Paul’s comments referred to concerns about China’s industrial overcapacity and its potential effects on manufacturers in other markets.
Paul called on the US government to take measures to protect domestic manufacturing employment.
The AAM is also urging Congress to pass the Connected Vehicle Security Act, which would restrict certain connected vehicles and components linked to China, Russia, Iran and North Korea. This policy push highlights the complex reality facing the US industrial base.
While employment in durable goods manufacturing has increased, the sector continues to face international competitive pressures. The September data show continued manufacturing employment growth, although the pace of hiring has slowed amid weaker overall US employment growth and concerns about international competition.
