2018 Economic Calendar
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Employment Situation  
Released On 9/7/2018 8:30:00 AM For Aug, 2018
PriorPrior RevisedConsensusConsensus RangeActual
Nonfarm Payrolls - M/M change157,000 147,000 195,000 150,000  to 237,000 201,000 
Unemployment Rate - Level3.9 %3.8 %3.8 % to 3.9 %3.9 %
Private Payrolls - M/M change170,000 153,000 190,000 160,000  to 237,000 204,000 
Manufacturing Payrolls - M/M change37,000 18,000 21,000 12,000  to 29,000 -3,000 
Participation Rate - level62.9 %62.8 %62.7 % to 62.9 %62.7 %
Average Hourly Earnings - M/M change0.3 %0.3 %0.2 % to 0.3 %0.4 %
Average Hourly Earnings - Y/Y change2.7 %2.8 %2.7 % to 2.8 %2.9 %
Av Workweek - All Employees34.5 hrs34.5 hrs34.4 hrs to 34.5 hrs34.5 hrs

Highlights
A heating up in wages headlines another very solid monthly employment report, one that is certain to firm expectations for a rate hike at the month-end FOMC. Average hourly earnings rose an outsized 0.4 percent in August, a monthly jump last matched in December 2017. The year-on-year rate, up 2 tenths to 2.9 percent, was last matched in 2009. Both of these results exceed Econoday's high-end forecasts.

Nonfarm payroll growth came in at 201,000 which is near Econoday's consensus for 195,000. But downward revisions are an offset here, stripping a total of 50,000 from the prior two months.

The industry breakdown shows an unexpected 3,000 decline in manufacturing jobs which is well below Econoday's low estimate and ends a long and very strong run. But construction is very solid, up 23,000 as is mining which, in a strong gain for this industry, rose 6,000.

Other positives include a 37,000 rise in trade & transportation where capacity is expanding and a 53,000 rise in professional services that includes a 10,000 gain for temporary help, both evidence that employers are scrambling to get work done.

Turning to the household survey, the unemployment rate held steady at 3.9 percent though the labor participation rate slipped 2 tenths to 62.7 percent. The number of people in the labor force went down by a half of million, to 161.8 million from 162.3 million reflecting a decrease in the number of employed which in this survey, in contrast to payrolls, includes the self-employed.

Wages popping higher like this and hitting long-term highs will make policy makers at the FOMC impatient. Full employment, or something very near to it, has been in the cards for the past couple of years and has many anticipating an inevitable acceleration in wages -- and with that the risk that overall inflation may overshoot the Fed's 2 percent target.

Consensus Outlook
In what is expected to be a strong August report, a 195,000 rise is Econoday's consensus for nonfarm payrolls with the unemployment rate seen falling 1 tenth to 3.8 percent. A 0.3 percent increase is the call for monthly average hourly earnings with this year-on-year rate also expected to rise 1 tenth, to 2.8 percent. Private payrolls are seen rising 190,000 with manufacturing payrolls expected to show another very solid increase at a consensus 21,000. The workweek is seen unchanged at 34.5 hours with the labor participation rate down 1 tenth to 62.8 percent.

Definition
The most closely watched of all economic indicators, the employment situation is a set of monthly labor market indicators based on two separate reports: the establishment survey which tracks 650,000 worksites and offers the nonfarm payroll and average hourly earnings headlines and the household survey which interviews 60,000 households and generates the unemployment rate.

Nonfarm payrolls track the number of part-time and full-time employees in both business and government. Average hourly earnings track employee pay while the average workweek, also part of the establishment survey, tracks the number of hours worked. The report's private payroll measure excludes government workers.

The unemployment rate measures the number of unemployed as a percentage of the labor force. In order to be counted as unemployed, one must be actively looking for work. Other commonly known data from the household survey include the labor supply and discouraged workers.  Why Investors Care
 
[Chart]
During the mature phase of an economic expansion, monthly payroll gains of 150,000 or so are considered healthy. Heading into recession, payroll gains begin to move below 100,000 and then, in confirmation of recession, into outright contraction. Coming out of recession, payroll gains are expected to surpass 250,000 per month.
Data Source: Haver Analytics
 
[Chart]
The unemployment rate measures those who have a job relative to those who are actively looking for a job. During recessions, those actively looking may grow discouraged, dropping out of the workforce and, in a counter- intuitive twist, putting downward pressure on the unemployment rate. During times of economic strength, workforce dropouts may regain their confidence and begin actively looking for a job once again which puts upward pressure on the unemployment rate.
Data Source: Haver Analytics
 
 

2018 Release Schedule
Released On: 1/52/23/94/65/46/17/68/39/710/511/212/7
Release For: DecJanFebMarAprMayJunJulAugSepOctNov
 


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