US payrolls rose in January by the most in more than a year and the unemployment rate unexpectedly fell, suggesting the labor market continued to stabilize at the start of 2026.

Employers added 130,000 jobs last month and the unemployment rate declined to 4.3%, according to Bureau of Labor Statistics data out Wednesday. That followed revisions to the prior year, which showed a marked slowdown in hiring. Job gains averaged just 15,000 a month last year, down from the initially reported 49,000 pace.

US Labor Market Rang in New Year With Solid Job Growth
Employers added larger-than-forecast 130,000 jobs, unemployment declined

The report suggests the labor market is finding its footing after a year marked by rising unemployment and minimal hiring. While economists expect hiring to remain generally sluggish in 2026, more clarity around the impact of President Donald Trump’s economic policies and lower borrowing costs could encourage some employers to boost headcount.