Total nonfarm payrolls grew by 525,000 in the first quarter of 2026, an average of 175,000 per month, according to the Bureau of Labor Statistics' quarterly summary. The pace marks a clear deceleration from the 220,000-per-month average of 2024 but remains well above the breakeven rate — currently estimated at around 100,000 per month — needed to keep the unemployment rate stable as the labor force expands.
Healthcare and social assistance was the dominant driver, contributing 188,000 jobs across the quarter — more than a third of the total. Hospitals added 64,000 positions, ambulatory care services added 78,000, and nursing and residential care facilities added 46,000. The sector has now added jobs in 60 consecutive months, the longest streak on record.
Government employment added 92,000 jobs, almost entirely at the state and local level, with public school staffing rebuilding after pandemic-era attrition. Federal government employment was essentially flat, reflecting both attrition policies and the continued unwinding of pandemic-era hiring at agencies like the IRS and SSA.
Leisure and hospitality contributed 78,000 jobs, with food services and drinking places accounting for the bulk of gains. The sector is now within 1.5% of its pre-pandemic peak and continues to benefit from elevated services consumption. Hotel and accommodation employment, which lagged through 2023, has now recovered to within 3% of February 2020 levels.
Construction added 51,000, supported by strong activity in single-family homebuilding and continued rollout of federally funded infrastructure projects. Specialty trade contractors added 38,000, residential building added 7,500, and heavy and civil engineering added 5,500. Nonresidential building was flat.
Professional and business services contributed just 64,000 — a notable slowdown from 2024 and reflective of softer demand for staffing and IT consulting services. Within the sector, employment services (which captures most temporary help) lost 22,000, while computer systems design added 18,000.
Manufacturing was a drag, shedding 14,000 jobs across the quarter as the goods-producing sector continued to contract. Retail trade was essentially flat, with gains at warehouse clubs and online retailers offset by losses at department stores and electronics dealers. Information and finance both posted small declines.
Average hourly earnings rose 3.9% year over year — modestly above the rate of consumer price inflation and consistent with productivity-led real wage growth. Wage gains were largest in healthcare (4.7%), construction (4.4%), and leisure and hospitality (4.2%), and smallest in information (2.6%) and finance (2.9%). The wage growth premium for job switchers over stayers, which peaked at 280 basis points in 2022, has narrowed to about 80 basis points — the lowest since 2018 and a sign that the labor market has substantially rebalanced.
Looking forward, most forecasters expect Q2 to come in near the Q1 pace, with a gradual deceleration through year-end as the cumulative impact of restrictive monetary policy continues to feed through. Healthcare, construction, and government are likely to remain the primary engines of job creation.