Thursday's Market Minute: Friday's Jobs Report To Deliver A Sober Employment Picture

Judging by the most recent JOLTS report, there’s obviously still demand for the worker. Economists say there’s been a consistent demand to fill vacant positions, and it’s still questionable whether there are enough workers to fill the open jobs.

Yet the surprise bump in nonfarm payroll growth in September is not expected to carry into October. It was likely due to seasonal hiring, particularly in education, economists say. They add that to maintain below 4% unemployment with the current pace of job growth would be a difficult feat.

Consensus estimates expect a 183,000 rise in nonfarm payrolls for October, which would still be a solid growth figure. Economists expect the unemployment rate to hold the same as September at 3.8%.

One factor to consider in this calculus: strikes. We will see how simultaneous strikes for the auto, health care, and entertainment industries influenced the monthly figures. The Bureau of Labor Statistics reported 48,100 workers were on strike during October, the most on a monthly basis since February 2004 when 72,000 California grocery store workers walked off the job

On a sector level, economists will be looking at the manufacturing/construction industry. Although it’s become a smaller portion of the total jobs picture over decades, it’s the most sensitive to the changing economic climate, economists note.

But the picture may soon change during this current month. Holiday hiring typically picks up during November. To date, Amazon AMZN has already announced it’s hiring 250,000 employees for the holiday shopping season. That’s 67% more than the amount of people the giant hired over the past two years. 

Yet as some retailers cut back on expenses in a challenging macroeconomic environment, they say they won’t have the same ramp-up in seasonal hiring this year. Target TGT plans to hire 100,000 employees during the holiday shopping season, flat from last year. And Macy’s M said it would hire more than 38,000 workers during the season, which would be a decline from last year. Retail researcher Challenger, Gray and Christmas in September predicted seasonal hiring will to fall to its lowest since 2008, due to lower consumer confidence and inflation.

Image sourced from Shutterstock

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