Job growth is finally starting to broaden—this signal matters more than the total nonfarm payrolls figure

When most people look at the nonfarm payrolls report, they focus only on the headline number. But today I want to discuss a signal that is easier to overlook but may be more important—whether job growth is broadening.

Over the past year or more, US job growth has been highly concentrated in a handful of sectors, such as healthcare and social assistance. More than 95% of US job growth in 2025 came from the healthcare and social assistance sectors, while employment growth in many other major sectors was very limited or even declined.

This “single-sector-driven” employment growth structure is actually quite fragile. If hiring in the healthcare sector slows, the overall employment data could drop sharply.

But some positive changes began to emerge this summer. From June to August, healthcare’s share of new job creation fell to about one-third, while sectors such as hospitality, restaurants, construction, manufacturing, and wholesale also began adding jobs. The number of professional positions also showed improvement.

Why does this change matter? Because it shows that the foundation of job growth is broadening. It is no longer being propped up by just one or two sectors, but is instead seeing a simultaneous recovery across multiple sectors. This kind of “broad-based” job growth reflects the economy’s true health better than the level of the monthly nonfarm payrolls figure.

If this trend of broadening job growth continues in September, it could be more meaningful than simply beating expectations. It would mean that even if one sector runs into trouble, other sectors could provide a buffer, strengthening the resilience of the overall labor market.

What does this signal mean for trading? It means that even if the total nonfarm payrolls figure falls short of expectations, as long as the trend toward broader job growth continues, we should not become overly pessimistic about the economic outlook. Conversely, if the nonfarm payrolls data looks good but growth remains concentrated in just a few sectors, the quality of that “good data” should be discounted.

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