More Weak Jobs Data Going Into Key BLS Payrolls & Unemployment Report
July 6, 2017 by Jon C. OggFriday’s payrolls and unemployment report from the U.S. Department of Labor will be closely watched. After all, unemployment and jobs add up to the best live-reading barometer of the economy. Each month we get to see numerous data reports from governmental and non-governmental sources that act as a bias meter for how each monthly unemployment report will look.
After weak small business hiring growth was seen this week, now more data is coming out that will likely keep a more muted expectation for the payroll gains from the Labor Department on Friday.
The Challenger Job-Cut Report for June was actually more positive than negative. This came out as 31,105 for June, and the May report was revised to 33,092 from 51,692. June’s report was the lowest since last October, another sign that employers want to hang on to already-trained employees. May’s report revision appears to have been influenced by some changes in Ford layoffs.
ADP’s employment report for June showed a gain of 158,000 in payrolls. Bloomberg had a consensus estimate of 180,000, and the preliminary gain of 253,000 in May was revised to 230,000. While this is less than expectations, the reality is that it is still growth and it is not so strong to spook the Federal Reserve into a more rapid rate hike campaign.
ADP’s national employment report is based on data from roughly 400,000 U.S. business clients using ADP client payrolls. It covers roughly 23 million employees.
One additional report from the Labor Department is the weekly jobless claims. This was 248,000 for the week ending June 30, slightly worse than the 244,000 consensus estimate from Bloomberg. The continuing jobless claims, which are reported with a one-week lag, rose by 11,000 to 1.956 million.
If you add up all these numbers, they should keep a very slight negative bias against any huge expectations. That being said, none of the numbers were so radically different from expectations that they should create any major changes from economist expectations this Friday. Bloomberg showed the following consensus estimates for Friday’s key Labor Department report:
- Nonfarm payrolls, +170,000
- Private sector payrolls, +164,000
- Unemployment, 4.3%
- Avg. hourly earnings (monthly), +0.3%
- Avg. hourly earnings (year over year), +2.6%
- Avg. workweek, 34.4 hours
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