Though pay growth is slowing, September job growth indicated that the labor market is robust enough for the Federal Reserve to hike interest rates this year. The Labor Department said 336,000 nonfarm payrolls grew last month in its carefully awaited employment report on Friday. August job growth was raised to 227,000 from 187,000.

Reuters economists predicted 170,000 job gains. Estimates were 90,000-256,000 employment. The larger-than-expected gain came despite seasonal adjustment concerns relating to education personnel returning from summer break, biasing the original September payroll report downward. The economy must produce 100,000 per month to keep up with working-age population growth.

The labor market’s resiliency 18 months after the Fed raised interest rates to reduce demand reflects restrictive monetary policy.

Few experts expect the U.S. central bank to raise rates again this year. The Fed has lifted its overnight interest rate by 525 basis points to 5.25%-5.50% since March 2022.

A UAW strike at General Motors (GM.N), Ford Motor (F.N), and Chrysler parent Stellantis (STLAM.MI) did not affect payrolls. About 25,700 of the 146,000 UAW members went on strike the week the government polled firms for September’s employment statistics.

Following a months-long strike by Hollywood actors, they returned to work following the payroll survey period. The unemployment rate stayed at 3.8%, an 18-month high.

Monthly salary growth was low, with average hourly wages up 0.2% after August. After rising 4.3% in August, salaries rose 4.2% through September. Wages are still increasing faster than the 3.5% experts estimate is consistent with the Fed’s 2% inflation aim. Wage growth may slow as fewer people quit their employment, but recent large union contracts offer a concern.

Labor market strength is helping maintain the economy, with third-quarter growth forecasts as high as 4.9% annualized, more than double the Fed’s 1.8% non-inflationary rate. Dark clouds are looming over the economy due to rising Treasury rates and political turmoil in Washington.

This month, millions of Americans begin student loan repayments, which economists believe would reduce consumer spending on durable items, residences, travel, and entertainment, affecting jobs. Economists say the end of the more than three-year moratorium may decrease student loan households’ monthly budgets by $ 40.