Anticipated Hiring Recovery
The November jobs report, scheduled for release on Friday at 8:30 a.m. ET, is expected to show a rebound in hiring after disruptions from hurricanes and a Boeing worker strike significantly impacted October’s numbers. The U.S. economy is projected to add 215,000 nonfarm jobs in November, a substantial increase from October’s mere 12,000. Meanwhile, the unemployment rate is forecast to remain steady at 4.1%, according to consensus estimates compiled by Bloomberg.
Economists at Goldman Sachs are anticipating a “post-hurricane rebound,” noting that hiring slowed by roughly 70,000 jobs in October due to hurricanes Helene and Milton. With those effects largely reversed by early November, payroll growth is expected to receive a 50,000-job boost. Additionally, the return of striking workers, including those at Boeing, is projected to contribute another 37,500 jobs.
Key Data Points to Watch
Here are the main metrics investors will focus on in Friday’s report (data from Bloomberg):
- Nonfarm Payroll Growth: Forecast at +215,000 (compared to +12,000 in October)
- Unemployment Rate: Forecast at 4.1% (unchanged from October)
- Average Hourly Earnings (Month-over-Month): Forecast at +0.3% (compared to +0.4% in October)
- Average Hourly Earnings (Year-over-Year): Forecast at +3.9% (compared to +4% in October)
- Average Weekly Hours Worked: Forecast at 34.3 hours (unchanged from October)
Labor Market Trends
Recent data suggests that while the labor market has slowed, it is not deteriorating rapidly. The Bureau of Labor Statistics reported that job openings rose to 7.74 million at the end of October, up from 7.37 million in September. This marked an increase from a 33-month low in job openings recorded in September.
Additionally, the quits rate—a key indicator of worker confidence—rose from 1.9% in September to 2.1% in October, its first increase since May 2023. This uptick suggests that despite some economic challenges, worker confidence in finding better opportunities remains intact.
Wage Growth and Labor Tightness
According to ADP’s payroll data, the private sector added 146,000 jobs in November, down from 184,000 in October. ADP also reported that the median annual pay increase for job switchers rose to 7.2% in November, up from 6.7% in October. This indicates persistent labor market tightness in certain sectors, even as overall job growth moderates.
ADP’s chief economist noted that job switchers’ wage growth serves as a real-time indicator of labor market conditions. “If wages for job switchers increased in November compared to October, it signals that the labor market remains somewhat tight,” she said.
Market Outlook and Implications
The November jobs report will provide crucial insights into the state of the U.S. economy and labor market. It will also play a key role in shaping expectations for the Federal Reserve’s upcoming monetary policy decisions. Investors will closely analyze whether the employment data supports a potential shift in the Fed’s approach.
For forex markets, the jobs report is likely to influence short-term movements in the U.S. dollar, which could ripple across global markets. Traders should remain attentive to the report’s release and its potential impact on broader market sentiment.
