Photo: St. Olaf College
Economists are closely watching today’s jobs report, with expectations for a 130K print when the August report is finally released at 8:30 a.m.Below, forecasts from some of the Street’s top names.
SOCIETE GENERALE (Brian Jones): +70K — Although the mean work span of all private employees probably held steady at 34.5 hours in August, the anticipated addition of 80,000 net new workers likely boosted the index of aggregate hours worked by 0.1%, matching the prior-month uptick.
JEFFRIES (Ward McCarthy): + 70K — We are not trying to make a statement; our analysis simply projects a weak payroll number. Once again, we also expect that the two employment surveys –establishment survey for payrolls and household survey for the unemployment rate—will tell somewhat different stories about the state of the labour market, as we project a dip in the unemployment rate to 8.2%.
WELLS FARGO (John Silvia): +75K — Notably, manufacturing employment, up 25,000 in July, was boosted by increased auto manufacturing jobs that are unlikely to hold up in August. With the data we have received to date, our econometric model points to substantially slower employment growth of 75,000 nonfarm jobs added in August.
MORGAN STANLEY (David Greenlaw): +100K— We look for a small decline in factory jobs in this month’s report. Also, the restaurant category appears to have been impacted by a seasonal quirk last month and may be due for a pullback.
BNP PARIBAS (Julia Coronado): +100K — The solid pick-up in jobs growth in July in services sectors, such as professional and business services, education, and leisure and hospitality, appeared to be partly due to temporary factors that are likely to fade in August.
JANNEY MONTGOMERY SCOTT (Guy LeBas): +102K — The biggest difference between July and August is payback: in July, seasonal adjustment factors compensate for annual factory shutdowns. This year, however, those shutdowns were fewer and generally shorter, meaning that payrolls data were exaggerated somewhat.
RBC (Tom Porcelli): +105K — With the sheer lack of momentum in leading economic activity – mainly on the orders front – suggests we should be poised for a softening labour backdrop not only in August, but over the course of the next few months/quarters.
TD SECURITIES (Eric Green): +105K — While we are encouraged by the tone of this report we will caution about reading too much into this positive surprise. In fact, based on its checkered history, with ADP overestimating payrolls growth in 3 of the last 5 months at an average spread of 77K, we see no reason for changing our current payrolls forecast for far more modest print of 105K.
BANK OF AMERICA MERRILL LYNCH (Ethan Harris): +110K — We look for job growth of 110,000 and the unemployment rate to hold at 8.3%. This report will be a crucial input into the Fed’s decision on September 13. A weak report (sub 75,000 job growth and rise in the unemployment rate) would fuel expectations of another round of QE. The reverse is true as well.
NATIXIS (Inna Mufteeva): +120K — [ADP] acceleration was purely driven by service-providing industries (+185K vs +156K in July) while goods-producing sector created roughly the same amount of jobs (16K vs 17K in July) with a 3K increase in manufacturing employment.
RBS (Michelle Girard): +125K — We also look for the employment gains in the education/health services and the leisure/hospitality sectors to have cooled modestly from their July rises. In most other sectors (including construction, retail, financial activities, transportation, utilities, information, and other services), tepid employment advances of 5,000 to 10,000 may have been registered.
UBS (Maury Harris): +135K — August will likely be little different, although boosted modestly by the end of a strike that had idled 10k employees. Our forecast also incorporates a jump in government sector payrolls following exaggerated weakness in recent months.
RAYMOND JAMES (Scott Brown): +140K — Seasonal adjustment is less of an issue in August, but could still swing the headline numbers somewhat higher or lower. The unemployment rate is expected to edge down to 8.2%, essentially unchanged.
CITI (Peter D’Antonio): +140K — Most of the rise should be in service producing industries. Although the monthly employment reports have alternated between hot and cold streaks, the underlying path has been fairly steady and consistent with modest overall growth.
CREDIT SUISSE (Neal Soss): +140K — Downside risk could come from local government education employment. The timing of returning teachers has caused past volatility in August, but it could wind up being a September story instead. Watch for possible noise in this sector this month or next month.
CREDIT AGRICOLE (Michael Carey): +145K — August employment-related indicators were mixed. The employment component of the ISM manufacturing PMI index moved lower as did regional manufacturing employment measures in the Empire State and Philly Fed reports. Initial claims for unemployment insurance drifted higher during the month.
BARCLAYS (Dean Maki): +150K — Jobless claims data during the survey week suggested that conditions in labour markets improved modestly relative to July and the VIX has fully reversed its rise from April to early June. Negative factors in the employment outlook include the employment diffusion index, which has softened recently.
DEUTSCHE BANK (Joe LaVorgna): +150K— The year-to-date average monthly gain has been +151k, which is almost identical to the comparable period last year (+152k). Moreover, over the last five months of 2011, nonfarm payrolls averaged +156k. We believe this is a good reference point for forecasting the remainder of 2012.
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