U.S. job gains accelerate in January as unemployment falls to 4.3%

January’s employment report showed nonfarm payrolls increased by 130,000 and the unemployment rate eased to 4.3%, producing a firmer-than-expected near-term reading that eases immediate pressure on policy makers. Revisions trimmed December’s payroll gain to just 48,000, tempering recent momentum and altering the short-run trajectory. The Bureau of Labor Statistics changed its birth-and-death adjustment so more current sample information feeds monthly estimates; forecasters say that methodological tweak could reduce recent monthly tallies by as much as roughly 50,000 jobs. Seasonal effects also mattered: unusually light holiday hiring in late 2025 lowered the typical January surge in separations, mechanically lifting net payroll additions this month. Separately, shorter-term corporate trackers signaled growing downside risk — outplacement firm Challenger, Gray & Christmas reported employers announced 108,435 planned layoffs in January, the largest January total in over a decade, while planned hires fell to just 5,306, the weakest reading in that series. Those announcements were concentrated among large private employers in technology, e-commerce, logistics and business services and could translate into higher separations or slower hiring in coming official releases. Government measures of layoffs and hires typically lag shorter-run trackers, so the Challenger data may foreshadow weaker payroll growth once separations are realized and reflected in BLS surveys. The BLS will also introduce updated annual population controls for the household survey in the near term, a change that will affect unemployment calculations and comparability across months. Taken together, the data portray a labor market that is steady rather than overheated: the headline jobs gain and lower unemployment support a pause in Fed tightening, but methodological updates, atypical calendar effects and a surge in corporate layoff announcements increase uncertainty about the durability of the recent improvement. Analysts and market participants should treat single-month readings cautiously and watch for follow-on releases that incorporate the birth-and-death model change and new population controls to confirm whether hiring truly reaccelerates or flattens.