US nonfarm payrolls for April 2026

Regional Federal Reserve surveys indicate declining trends for employment and capital. Expectations for future employment and capital expenditures are anticipated to moderate or decline in the second half of 2025, reflecting the lagged impact of the 2023-2024 monetary policy tightening cycle. Specifically, the Third District (Philadelphia) Manufacturing Business Outlook Survey reported a consistent decline in expectations. The Future Employment diffusion index decreased from 10.0 in September 2025 ^{[^]} to 5.0 by December 2025 ^{[^]}. Similarly, the Future Capital Expenditures index for the Philadelphia region demonstrated a declining trend throughout the latter half of the year, signaling reduced investment ^{[^]}.

Kansas City Fed also shows modest softening in future indicators. Surveys of manufacturing activity in the Tenth District (Kansas City) for the second half of 2025 suggested a modest softening in forward-looking indicators. While the indices for future employment and capital expenditures largely remained positive, the December 2025 report indicated slight declines compared to prior months within the latter half of the year ^{[^]}. For example, the future employment index for the Tenth District was 8 in December 2025 ^{[^]}, and the future capital expenditures index was 7 ^{[^]}, pointing to a slight moderation in hiring and investment expectations.

Q1/Q2 2026 anticipates an acceleration or peak in job creation for large-scale projects funded by the Inflation Reduction Act (IRA) and the CHIPS Act. This period is expected to see a significant increase in hiring, particularly for construction and manufacturing roles. In the clean energy sector, substantial job increases are projected. Analysis from the Environmental and Energy Study Institute (EESI) indicates that the first half of 2026 will be a time of significant growth and strong hiring for clean energy jobs, primarily driven by IRA investments in manufacturing and construction ^{[^]}.

Semiconductor projects will see accelerated initial hiring for construction during Q1/Q2 2026, fueled by the CHIPS Act. For instance, the Micron Clay Megafab project in Upstate New York, a major CHIPS Act investment, is expected to be in early construction stages, necessitating substantial hiring for construction jobs ^{[^]}, ^{[^]}. While actual chip production will commence later, 2026 is critical for foundational construction and related employment, supported by tens of billions in investments driving high demand for talent ^{[^]}, ^{[^]}, ^{[^]}. Overall, based on specific project timelines and sector projections, Q1/Q2 2026 is characterized by an acceleration leading to, or being part of, a peak in job creation for these projects. The Congressional Budget Office (CBO) broadly supports sustained economic benefits from such investments, with significant employment impacts often occurring during intensive construction phases, suggesting a robust period for job creation rather than a deceleration ^{[^]}, ^{[^]}, ^{[^]}, ^{[^]}.

New business applications show continued activity, but specific growth rates are limited. The year-over-year growth rate for 'Business Applications with Planned Wages' in late 2025 was not explicitly detailed with specific percentages in available monthly U.S. Census Bureau reports, which covered data up to July 2025 ^{[^]}. However, the overall series, tracked via FRED, indicated continued activity in new business formation with planned employment, serving as an early indicator of employer business growth ^{[^]}. This activity suggested an ongoing, though potentially moderating, trend in new employer business starts.

Small businesses plan job growth and face persistent labor demand. This trend generally aligns with employment plans reported by the National Federation of Independent Business (NFIB). According to their December 2025 Small Business Economic Trends report, a net 13% of small business owners planned to increase employment, signaling an intent for continued job creation among these firms ^{[^]}. The report also highlighted persistent labor demand, with 42% of owners reporting unfilled job openings during December 2025, underscoring an ongoing need for workers ^{[^]}.

Combined data suggests a positive outlook for small business job creation. The combination of sustained business application activity, even if moderating, alongside small business owners' intentions to expand employment and their challenges in filling existing vacancies, points to a generally positive environment for small business job creation in late 2025 ^{[^]}. This trend is consistent with a healthy job market contributing to overall employment figures as the economy transitioned into early 2026.

Net international migration exceeded CBO projections. Recent analyses show net international migration reached approximately 1.1 million between July 2024 and July 2025, surpassing the Congressional Budget Office's (CBO) September 2025 projections of an average of 1.0 million annually from 2025 to 2030 ^{[^]}. These observed migration trends are directly contributing to the U.S. population and its labor force.

Foreign-born workers significantly boost the U.S. labor force. From January 2025 to February 2026, the foreign-born labor force experienced a significant increase of 1.6 million individuals, representing about 90% of the total U.S. labor force growth during this period ^{[^]}. As of February 2026, the foreign-born labor force comprised 30.1 million people, with a participation rate of 65.5%. This rate is notably higher than the 62.0% participation rate observed for the native-born population, demonstrating a substantial and consistent contribution to the available labor pool ^{[^]}.

Increased foreign-born labor supply strengthens the economy. This robust and sustained growth in the foreign-born labor force is crucial for the overall labor supply, helping to alleviate labor shortages across various sectors and supporting continued economic expansion ^{[^]}. The higher labor force participation among foreign-born individuals means they contribute more effectively to the active labor pool. This demographic trend is anticipated to add approximately 0.4 percentage points to GDP growth by the end of 2026, thereby mitigating inflationary pressures and strengthening the labor market's capacity to meet demand ^{[^]}.

The Bureau of Labor Statistics (BLS) Birth/Death model estimates jobs from new and closing businesses. This model is a critical component of the Non-Farm Payroll (NFP) calculation, designed to estimate employment changes from new business formations and closures not directly captured by the monthly establishment survey ^{[^]}. Typically, the model adds a net positive number of jobs during periods of economic expansion, as business formations tend to outpace closures ^{[^]}. However, its contribution is highly seasonal; it commonly shows a net negative adjustment in January, historically ranging from -90,000 to -120,000 jobs, before shifting to positive contributions in subsequent months like February, March, and April if economic expansion persists ^{[^]}.

In early 2026, the model will follow historical seasonal patterns. Assuming continued economic growth, the Birth/Death model for early 2026 is expected to adhere to this established seasonal pattern. This implies an estimated net negative contribution to the NFP figure for January 2026, consistent with prior year-start adjustments ^{[^]}. Subsequently, the model's estimated net contribution for February, March, and April 2026 would likely become positive, potentially adding tens of thousands to over 100,000 jobs, provided the economy remains robust and net business formation continues ^{[^]}. Conversely, a substantial economic slowdown or contraction in early 2026 could diminish these anticipated positive contributions or even lead to negative adjustments as business dynamics shift ^{[^]}.

Upcoming changes and revisions will significantly impact 2026 model estimates. It is crucial to recognize that the BLS has announced methodological changes to the Establishment Survey Birth-Death model for 2025, which will inevitably influence its estimates for 2026 by affecting the magnitude and timing of its contributions ^{[^]}. Furthermore, the January 2026 jobs report will incorporate annual benchmark revisions for 2025, which serve to adjust payroll survey data to more comprehensive employment counts ^{[^]}. These revisions provide a more accurate base for future projections, meaning that while historical patterns offer a strong guide, the precise 2026 contributions will be subject to these new adjustments and updates ^{[^]}.

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