Preview of all the numbers that matter ahead of the April 2017 non-farm payrolls employment report:
The US employment report is due at 8:30 am ET on Friday, May 5, 2017:
- Median NFP estimate 190k (188k private)
- March 98K
- Highest estimate 281k (JPMorgan)
- Lowest estimate 145k (Presige Economics)
- Average estimate 191.7k
- Standard deviation 23k
- Unemployment rate exp 4.6% vs 4.5% prior
- Prior participation rate 63.0%
- Avg hourly earnings m/m exp 0.3% vs +0.2% prior
- Avg hourly earnings y/y exp 2.7% y/y vs 2.7% prior
- Avg weekly hours exp 34.4 vs 34.3 prior
Here's the April jobs story so far
- ADP 175K vs 177k prior (exp 177K)
- ISM manufacturing employment 52.0 vs 58.9 prior
- ISM non-manufacturing employment 51.4 vs 51.6 prior (lowest since Aug)
- Initial jobless claims 4 wk avg 243K vs 250k prior (for April NFP survey date)
- Consumer confidence jobs hard to get 19.1 vs 19.0 prior
- Conference board help wanted online demand for hiring -26,100.
- Challenger April layoffs -42.9% y/y vs -2.0% y/y prior
- Feb JOLTS 5650K vs 5625k prior
The question is: How much does the report mean to the Fed?
In terms of jobs, not much. Policymakers have warned for a long time that job growth is going to slow down because the economy is near full employment. They brushed off last month's poor reading and are likely to do the same this month so long as it stays above +50K.
What matters is wages. It's been a focus of the market and the Fed for more than a year. A June hike isn't the done deal that Fed fund futures are pricing and that will be clear if y/y wage growth falls to +2.5% or lower.
The playbook for the past year has been to ignore the jobs headline and unemployment rates. Instead focus on wages, hours worked or anything else that will play into inflation. It will be the same on Friday.
