The U.S. economy is expected to add fewer jobs in August vs. July, but still stay in the sweet spot seen for a soft landing. Economists are expecting to see a print of 170K at 8:30 AM ET, down slightly from the 187K climb the prior month, with the unemployment rate staying near 50-year lows at 3.5%. The labor force participation rate, or the percentage of the population that is either working or actively looking for work, is also expected to be unchanged at 62.6%, with average hourly earnings growth forecast to stay at 4.4% Y/Y.Snapshot: In its effort to squash inflation by jacking up interest rates, the Fed has wanted to see more slack in the jobs market. Indeed, an overall imbalance between labor demand and supply is causing wages to remain elevated, but a batch of data this week has pointed to just what the Fed wants to see: moderating labor demand. Wednesday's ADP jobs report, for example, showed companies in August added the least number of jobs in five months.The BLS' JOLTS, short for Job Openings and Labor Turnover Survey, also revealed the number of job openings in July unexpectedly fell to the lowest level since early 2021. Elsewhere, job cuts announced by employers more than tripled in August vs. July. One outlier this week was initial jobless claims, a leading indicator, slipping below the consensus estimate. Also in the Fed's favor, the dual strikes in Hollywood are expected to impact today's jobs data as many companies support the movie and television industry.SA commentary: Analyst Christopher Robb is confident that August's jobs report will show "something in line with a soft-landing narrative that continues the trend from the last three reports," citing a steady decline in worker quits. He also points out some risks that could, in turn, counter his hypothesis, including the potential for workforce increases from immigration. "This could lead to a level of job growth that pushes wage pressure outside of the Goldilocks zone needed for inflation to keep coming down without Old Testament labor market carnage." (18 comments)
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| | Top News  Getty Images The U.S. economy is expected to add fewer jobs in August vs. July, but still stay in the sweet spot seen for a soft landing. Economists are expecting to see a print of 170K at 8:30 AM ET, down slightly from the 187K climb the prior month, with the unemployment rate staying near 50-year lows at 3.5%. The labor force participation rate, or the percentage of the population that is either working or actively looking for work, is also expected to be unchanged at 62.6%, with average hourly earnings growth forecast to stay at 4.4% Y/Y.
Snapshot: In its effort to squash inflation by jacking up interest rates, the Fed has wanted to see more slack in the jobs market. Indeed, an overall imbalance between labor demand and supply is causing wages to remain elevated, but a batch of data this week has pointed to just what the Fed wants to see: moderating labor demand. Wednesday's ADP jobs report, for example, showed companies in August added the least number of jobs in five months.
The BLS' JOLTS, short for Job Openings and Labor Turnover Survey, also revealed the number of job openings in July unexpectedly fell to the lowest level since early 2021. Elsewhere, job cuts announced by employers more than tripled in August vs. July. One outlier this week was initial jobless claims, a leading indicator, slipping below the consensus estimate. Also in the Fed's favor, the dual strikes in Hollywood are expected to impact today's jobs data as many companies support the movie and television industry.
SA commentary: Analyst Christopher Robb is confident that August's jobs report will show "something in line with a soft-landing narrative that continues the trend from the last three reports," citing a steady decline in worker quits. He also points out some risks that could, in turn, counter his hypothesis, including the potential for workforce increases from immigration. "This could lead to a level of job growth that pushes wage pressure outside of the Goldilocks zone needed for inflation to keep coming down without Old Testament labor market carnage." (18 comments)
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In Europe, at midday, London +0.6%. Paris +0.2%. Frankfurt flat.
Futures at 6:30, Dow +0.3%. S&P +0.3%. Nasdaq +0.1%. Crude +1.1% to $84.55. Gold +0.2% to $1970.50. Bitcoin -4.3% to $26,027.
Ten-year Treasury Yield +2 bps to 4.11%
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