Jobs Report Delivers A Positive Employment Backdrop

Market Commentary – February 17, 2026

The January Employment Situation Report was published by the Bureau of Labor Statistics (BLS) last Wednesday and showed nonfarm payrolls increasing by 130,000, significantly exceeding expectations.

Private payrolls rose by 172,000, also significantly exceeding expectations. The unemployment rate fell from 4.4% to 4.3%. This was a strong, positive report. On the government side, jobs declined by 42,000 overall, with federal government jobs down 34,000, state jobs down 18,000, and local jobs up 10,000. The report also included the annual benchmark revision, which lowered prior-year employment estimates. March 2025 was revised downward by about 862,000 on a not seasonally adjusted basis, while seasonally adjusted revisions totaled a loss of roughly 898,000 – indicating that the prior period was weaker than previously reported. The market seemed to easily move past this revision. The market is still looking for two interest rate cuts: one is priced in for July and another one for later in the year. With last Friday’s release of the January Consumer Price Index (CPI), BLS will have fully resumed its standard monthly publication schedule, following disruptions from the October 2025 government shutdown.