On Friday the 5th of May, at 8:30 AM ET, the BLS is set to release the US Nonfarm Payrolls and Unemployment Rate numbers for the month of April.
Here are some views on what to expect:
Median analyst estimates for Nonfarm Payrolls are 180k, with the highest estimate at 2265K, and the lowest at 125K.
As for the Unemployment Rate, median estimates see it rising slightly to 3.6% from 3.5%, with the highest estimate at 3.6%, and the lowest at 3.4%. The majority of bets are at 3.6%.
On Friday, we have the April jobs report and this is expected to record a further moderation in jobs growth. CEO confidence is at levels consistent with recession, while small business optimism is weaker than during the lowest point of the pandemic. This indicates that business leaders are likely adopting a more defensive mindset that equates to reduced capex spending. Job loss announcements are up 400% according to the Challenger survey, with jobless claims also starting to creep higher. The Fed itself forecasts the unemployment rate to rise to 4.5% by year-end as the result of a “mild recession", but we see more upside risk to the jobless rate.
NFP Forecast: 195K
US Unemployment Rate Forecast: 3.6%
Slowly bending, not breaking, has so far been the story of the labor market this year. That is unlikely to change with April's employment report. In March, nonfarm payrolls rose by 236K, the weakest print since December 2020. Signs were more encouraging in the separate household survey, where employment rose by 577K, causing the unemployment rate to tick back down to 3.5%.
The labor force participation rate also rose for a fourth straight month. But falling hiring plans and job openings point to the demand for workers continuing to trend lower.
With some hiring pulled forward by the unusually warm weather to start the year, we look for payroll growth to slow to 195K in April and for the unemployment rate to edge back up to 3.6%.
Another 0.3% increase in average hourly earnings would keep the year-over-year rate at 4.2%.
We’re watching the US jobs data where we expect to see ongoing labor market tightness.
That is keeping wage growth and core inflation elevated.
S&P Global Market Intelligence
The health of the banking sector will play a key role in the FOMCs decision-making process, but so will the state of the labor market, bringing Friday's employment report firmly under the spotlight. Current expectations are for the jobless rate to tick higher and payroll growth to slow, but to remain robust at around 180k. Anything other than an upside surprise will fuel speculation that May's hike will be the last in the current cycle.
NFP Forecast: 185K
US Unemployment Rate Forecast: 3.5%
The previous release was on April 7th. Nonfarm Payrolls for March came in at 236k, against the median forecast of 230k. NFP had a small deviation from the forecast, however, compared to the prior employment figure it had cooled off by 75K.
The reaction to this release was pronounced with both upside in the S&P and DXY, the reaction came largely from the 75K decrease in job growth compared to the prior month, and adding to this was a decrease in the US Average Earnings YoY.