US jobs creation surges unexpectedly in September

Hiring in the US surged unexpectedly last month, in a rebuttal to those worried that the economy might be headed for a sudden, sharp downturn.

Employers in the US added 254,000 jobs in September, much more than expected, while the jobless rate dipped from 4.2% to 4.1%%, the Labor Department said.

That was the strongest gain since March, and was far higher than the roughly 150,000 many analysts had forecast.

The closely watched report comes a few weeks before Americans will head to the polls in an election in which the state of the economy has been cited as a top concern.

Jobs growth has slowed significantly since last year and the unemployment rate has been ticking higher, though it remains a historically low levels.

Last month, the US central bank cut interest rates by a bigger than usual 0.5 percentage points, saying it wanted to avoid any further weakening in the labour market.

But the strength in this month’s report could raise flags for those hoping for the Federal Reserve to continue to rapidly lower rates.

Bars and restaurants led the hiring in September.