The Bureau of Labour Statistics is back at it today releasing the September jobs report postponed during the government shutdown.
Here’s a quick tally of what economists are expecting:
- Nonfarm payrolls: +180,000
- Private payrolls: +182,000
- Unemployment rate: 7.3%
- Average hourly earnings: +0.3% month-over-month, +7.3% year-over-year
- Average weekly hours: 34.5
Thanks to a smattering of private sector reports that offer information on the U.S. labour market, economists can still hazard a guess on where the BLS report will land. Let’s round up a few reports we’ve seen:
- Initial unemployment insurance claims: Jobless claims for the week ending September 28, came in at a very low 308,000. The four-week moving average fell to 305,000, which is the lowest level since May 2007.
- ADP National Employment: ADP said U.S. companies added 166,000 private payrolls in September. This was a bit weaker than the 180,000 jobs expected by economists. Even worse, the August number was revised down to 159,000 from an earlier estimate of 176,000.
- Challenger Planned Layoffs: Announced job cuts fell to 40,289 in September from 50,462 in August. The health care sector was responsible for 8,128 of those job cuts, largely due to lower government reimbursements tied to the sequester.
- ISM non-manufacturing index: The ISM services employment sub-index fell to 52.7 in September from 57.0 in August. This suggests services jobs are growing, but at a decelerating pace.
- ISM manufacturing index: The ISM manufacturing employment sub-index climbed to 55.4 in September from 53.3 in August. This suggests manufacturing jobs are growing at an accelerating pace.
- Gallup US Payroll to Population: According to Gallup’s data, the payroll-to-population ratio fell to 43.5% in September from 43.7% in August.
- Dallas Fed Manufacturing Index: From the September report: “Labour market indicators reflected continued employment growth but flat workweeks. The September employment index was 10, its third reading in a row in solidly positive territory. Seventeen per cent of firms reported hiring new workers compared with 7 per cent reporting layoffs. The hours worked index was near zero, indicating little change from August in average workweek length.”
- Chicago Purchasing Managers Index: Employment softened for the third consecutive month and was the only barometer component to fall in September.
- Philly Fed Manufacturing: The report’s headline index dropped to 19.8 in October from September’s 22.3 print, but “the current employment index increased 5 points, to 15.4, its highest reading since May 2011,” according to the report. “The percentage of firms reporting increases in employment (23 per cent) exceeded the percentage reporting decreases (8 per cent).”
- Federal Reserve’s October Beige Book: The Fed’s regional banks reported some anecdotes of optimism, but concerns about fiscal issues dogged businesses. “Employment growth remained modest in September,” according to the report. “Several Districts reported that contacts were cautious to expand payrolls, citing uncertainty surrounding the implementation of the Affordable Care Act and fiscal policy more generally.”
Here’s some commentary from market economists:
- Morgan Stanley’s Ted Wieseman (Est. +185,000): “There have been some encouraging signs there recently, with the Manpower employment outlook survey reaching its best level since 2007. So we look for payroll growth to pick up in September after a more sluggish 148,000 average gain in the three months through August. Relative to the 169,000 gain in August, the main swing factors should be a positive reversal in the information category after an unusual 22,000 plunge in movie studio employment last month and, on the other side, a flattening out in local government teachers after a 20,000 rise in July probably reflected seasonal adjustment issues with summer break. Meanwhile, manufacturing jobs should add to last month’s rebound amid indications of a turn higher in factory output following weakness in the spring, but financial sector jobs will likely add to last month’s decline, as banks have continued to adjust to much lower levels of mortgage refinancing activity. With a slight turn higher in labour force participation after the steep drop last month, the pace of job growth we’re expecting should leave the unemployment rate steady, but if participation is unchanged or moves lower again, the unemployment rate would decline.”
- Credit Suisse’s Jay Feldman (Est. +165,000): “Our latest expectations are 165K for total nonfarm payrolls and 175K for private jobs and a slightly lower unemployment rate at 7.2%. Our payrolls forecasts are somewhat lower than our earlier estimates of 190K total/200K private for two reasons. First, the ISM Non- Manufacturing jobs index corrected sharply in September. Second, in hindsight, the sharp decline in claims over the September period looks to be more a function of the computer glitches plaguing California jobless claims than any fundamental improvement.”
- Societe Generale’s Brian Jones (+240,000): “We expect a strong reading on 240,000 net new workers, well above the 148,000 average posted over the June-August period and consensus (180,000). We also expect the unemployment rate to fall to 7.1%. Such strong readings would again ignite a debate on an imminent start of US tapering, but given that the full impact of the recent shutdown may take some further time to emerge, we continue to see tapering in Q1 next year.”
- UBS’s Drew Matus (+195,000): “Employment growth probably re-accelerated in September after the smaller than expected rise in August and downward revisions to the previous two months. Labour markets appear to be improving. The trend in jobless claims continued to drop in September; consumers’ assessments of the labour market continued to improve; and the September ISM surveys appeared roughly consistent with our forecast for a 195,000 rise in headline payrolls.”