Unemployment Hits 4.6% in the Latest Jobs Report. What This Means for Wall Street
Summarize this article with:
Job seekers didn't get the news they were hoping for on Tuesday. Did investors?The U.S. economy is continuing to limp along. That's what the latest unemployment report seemed to indicate. The update was delayed due to the government shutdown, but the numbers showed the labor market continuing to weaken. The unemployment rate rose to 4.6%, its highest level in four years, up from 4.2%, and the economy added only 64,000 jobs. The Bureau of Labor Statistics said there's been little net job growth since April. There were other concerning signs as well, as the number of people working part-time but looking for full-time work jumped by 909,000 from September to 5.5 million. Image source: Getty Images. What it means for Wall Street Investors pay close attention to the labor market report as it's generally considered the most important piece of monthly economic data to come out of the federal government. After all, the labor market is a huge part of the economy, but the relationship between the labor market and the stock market can be complicated. The jobs report influences the Fed, and stock investors generally prefer for interest rates to fall. A softening labor market tends to push the Fed toward cutting rates, and there are times when Wall Street will cheer a bad jobs report because of that relationship. As of Tuesday afternoon, stocks were heading lower with the S&P 500 (^GSPC 0.24%) down 0.6%, a sign investors didn't think the numbers were bad enough to encourage more rate cuts and may just see it as another negative data point about the macro-level economy.Advertisement In its "dot plot" forecast released last week, the Fed did not see unemployment continuing to rise. In fact, the board of governors called for 2025 to finish with an unemployment rate of 4.5% and for it to edge down to 4.4% by the end of 2026. The forecast showed the Fed expects just one rate cut in 2026, a sign that the central bankers aren't anticipating any kind of economic emergency. In that light, the November report looks worse than expected, and the unemployment rate could rise into December, which we'll learn in just a few weeks when the December employment report comes out. ExpandSNPINDEX: ^GSPCS&P 500 IndexToday's Change(-0.24%) $-16.25Current Price$6800.26Key Data PointsDay's Range$6759.74 - $6819.2752wk Range$4835.04 - $6920.34Volume3.2B Just one data point Ultimately, the jobs report is just one data point for investors to consider, but it offers one of the best up-to-date measurements of the current economy. Keep your eye on the December report and those coming out in the next few months. If the unemployment rate continues to rise, the Fed may be forced to get more aggressive with rate cuts. Whether that's a good thing for investors will depend on the status and direction of the job market. Heading into 2026, there's still plenty of uncertainty in the economy and the labor market.About the AuthorJeremy Bowman has been a contributing Motley Fool stock market analyst, covering technology, consumer goods, and macroeconomic trends since 2011.
Before The Motley Fool, Jeremy was a newspaper reporter, restaurant manager, and English teacher abroad. He holds a bachelor’s degree in English from Colorado College and a master’s degree in business administration from American University. One of his Motley Fool headlines was briefly featured on Late Night with Stephen Colbert.TMFHoboX@TMFBowmanRead NextDec 16, 2025 •By Adam SpataccoWill There Be a Santa Claus Rally in the Stock Market This Year?Dec 16, 2025 •By Jeremy BowmanThe Stock Market Is About To Do Something It's Only Done Three Times Since the Postwar Era.
History Says This Is What Happens in 2026Dec 15, 2025 •By Eric TrieStock Market Today, Dec. 15: U.S Stocks Ease as Investors Wait for Rate ClarityDec 15, 2025 •By Adria CiminoWarren Buffett Has Repeated His Warning to Wall Street for 12 Quarters. Now, as 2026 Approaches, Is It Time to Listen?Dec 15, 2025 •By Bram BerkowitzWhy December 16 to 18 Could Be Big Days for the S&P 500 IndexDec 15, 2025 •By Keith SpeightsThe S&P 500 Is About to Do Something It's Only Done 8 Times in 100 Years. Here's What History Suggests Will Happen in 2026.