EMPLOYMENT FRIDAY PREVIEW

No single report so far this year will be as closely watched as May’s employment situation. Job growth, despite a surge in job openings, dramatically stalled in April, raising questions whether emergency benefits are limiting the initiative of the unemployed.

See the report here

Employment Situation

Consensus Outlook
A rise of 645,000 is Econoday’s consensus for May nonfarm payrolls following April’s increase of 266,000. After exceeding expectations significantly in February and March, this report missed expectations badly in April.

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 US economy added 266,000 jobs in April, far less than Econoday’s consensus for a 998,000 gain, with the lowest forecast at 755,000. The disappointment was reinforced by the downward revision to March’s estimate now at 770,000 from 916,000.