The official April U.S. jobs report will be released at 8:30 a.m. ET on Friday morning.
Here's a rundown of the expectations according to economists surveyed by Bloomberg:
- Nonfarm payrolls: +218,000
- Private payrolls: +215,000
- Unemployment Rate: 6.6%
- Avg Hourly Earnings: 0.2% MoM, 2.1% YoY
- Avg Weekly Hours: 34.5
The improving weather is the big story.
"We think the return to better weather in April will unleash some pent-up hiring, but we don't see a strong weather-related bounce," said Bank of America Merrill Lynch economists, who expect NFP to increase by 215,000.
"Among the components, we think the risk is that construction hiring disappoints given sluggish housing starts in March and low homebuilder sentiment in early April. Moreover, after revisions, it appears that construction job growth was fairly robust over the prior three months, following the decline in December. Job growth in manufacturing and the retail sector should increase given the pickup in production and sales."
Economists will also be keeping a close eye on hourly earnings for any sign that suggests wage growth will heat up.
"Earnings have been subdued and relatively stable for a while, and have not been a major market focus," said Credit Suisse economists. "This could change as the unemployment rate grinds lower and the degree of labor market slack becomes a hotter topic of debate."
Estimates for NFP range from 150,000 to 292,000. Economists on the high end of that range emphasize the low jobless claims number during the BLS's jobs report survey period. Here's some of what market economists are saying:
- UBS's Sam Coffin: 150,000— "Our forecast reflects a small boost from a residual weather-related rebound and some continued improvement in underlying trends, with a counterweight from unfavorable calendar effects... Within payrolls, incremental strength is likely in manufacturing, retail trade, and information industry payrolls—all of which had slowed, on balance, in recent months. The decline in jobless claims over the past month has been consistent with some labor market improvement. We do see some drag from calendar effects. The gap between the March and April payroll surveys was four weeks. A four-week gap has been associated with below- trend April payrolls in 12 of the last 15 instances (and more recently in 4 of the last 5 instances). We put the downward bias for this month at about 20k and otherwise would have estimated April payrolls at 200k."
- High Frequency Economics' Jim O'Sullivan: 185,000— "...but we are allowing for the recurring pattern of payrolls being under-reported initially, only to be revised up later. Nor are we counting on any additional catch-up for weather effects. The household survey series on the number of people with a job but not at work because of bad weather was back to its normal level in March after being unusually high in February."
- Citi's Peter D'Antonio: 225,000— "We expect another solid gain in payroll employment in April, as the labor market normalizes from the weather distorted readings in December and January. By our estimates, this should be the last reading influenced by winter weather. At this point, we think the trend is still about 180K per month, but we do expect that the running rate will pick up this year toward 200K. Note 1: We can’t rule out that the tail end of the payroll rebound occurs through revisions, rather than a big rise in April. Last month, the headline gain was smaller than we expected, but upward revisions to earlier months made up the difference."
- Deutsche Bank's Joe LaVorgna 240,000— "...claims data showed a new cyclical low for the employment survey period. This is a very positive sign for the labor market that is also being confirmed by the growth in employee tax withholding receipts."
- Barclays' Dean Maki: 250,000— "Both initial and continuing jobless claims have fallen significantly in April, suggesting a more robust pace of job growth than in recent months. We also believe more normal weather conditions than those prevailing earlier in the year will support job creation in April."
- Morgan Stanley's Ted Wieseman: 250,000— "Since the weather started to become less severe in mid-February, jobless claims have shown a big improvement that accelerated in the first half of April, pointing to a significantly reduced pace of firings recently. The 4-week average of initial claims fell to 312,000 in the survey week for the April employment report from 329,500 in March, and 336,500 in February, a seven-year low and very strong level historically. With layoffs declining, as long as hiring rates have at least held steady, net job growth has accelerated. We look for a temporary pickup to a pace moderately above the pre-winter trend near 200,000, reflecting some catch up reversal of winter drags."
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