The August jobs report, due out Friday, is shaping up as among the most significant in years, with the outcome likely to either allay, or stoke recession fears following feeble payroll gains the prior month.
The tally also could determine whether the Federal Reserve will cut its key interest rate by a quarter percentage point this month, as expected, now that inflation is approaching the central bank’s 2% goal. Alternatively, officials could reduce the rate by half a point if they believe the economy and labor market are wobbling and they need to make a dramatic move to head off a downturn.
The job numbers could have an outsized impact on a volatile stock market.
“It’s going to be the most closely watched employment report in some time,” economist Michael Reid of RBC Capital Markets said.
What is the job report prediction for the US?
Economists generally expect a rebound from a rough July report, according to a Bloomberg survey, with employers adding 165,000 jobs and the unemployment rate ticking down to 4.2%.
The July jobs figures were uniformly ugly but most forecasters say they overstated an expected slowdown in job growth following a post-pandemic surge. Employers added just 114,000 jobs, well below the 175,000 projected, and the unemployment rate jumped from 4.1% to 4.3%, the highest since October 2021.
Why is the job market down in 2024?
Yet analysts say the unusually weak showing can be traced to several one-off factors.
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