Jobs report shows big 336,000 gain in hiring in September. Labor market is still hot.

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Unemployment rate unchanged at 3.8% in September

The numbers: The U.S. gained 336,000 new jobs in September — much bigger than Wall Street expected — in a sign businesses still have a strong appetite for labor.Economists polled by the Wall Street Journal had forecast 170,000 jobs last month.The surprise increase in hiring, unless it’s a one-off, could complicate the Federal Reserve’s decision on when to stop raising interest rates.

The Fed has sharply increased borrowing costs to tame inflation, but it risks a recession if it keeps raising rates. The Fed is worried an ongoing labor shortage could spur bigger wage increases and add to price pressures. In some good news for the Fed, hourly wages rose a mild 0.2% in September. The increase in wages over the past year slowed again to 4.2%.

After the report, premarket gains by the Dow Jones Industrial Average DJIA, -0.03% and S&P 500 SPX were wiped out. The yield on the 10-year Treasury BX:TMUBMUSD10Y rose several basis points to 4.76%.

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