NonFarm Payrolls


Impressive July jobs report revive hawkish Fed bets

US jobs report post-release checklist – August 5th, 2022

NFP Actual, Consensus and Deviation Positive The US economy added 528K jobs in July, better than the 250K expected.
NFP Revisions Neutral June figure slightly revised upward to 398K from 372K.
Unemployment rate Positive

U3 unemployment rate stayed at 3.5% a bit lower than expected, the U6 underemployment came as expected wwith 6.7%.

Labor Force Participation Rate Neutral The share of people in the workforce is a tick down to 62.1%.
Average Hourly Earnings Positive Montly change in wages came out at 0.5%, better than expected, while yearly wages remained unchanged at 5.2%, better than the 4.9% expected.

 

JULY US JOBS REPORT Preview

US jobs report pre-release checklist – July 8th, 2022

Previous Non-Farm PayrollsPositiveThe US economy added 390K jobs in May, better than the 325K expected.
Challenger Job CutsNegativeThe number of corporate layoffs increased in June to 32.517K, the first time in 15 months above 30K.
Initial Jobless Claims NegativeThree of the last four weekly unemployment claims releases have been worse than expected, with the week ending on June 24 seeing 231K first-time claimers.
Continuing Jobless Claims NegativeThe number of employment seekers has surprised negatively three of the last four weeks, but is still near all-time lows.
ISM Services PMI NegativeThe employment sub-index for the main service-sector survey in the US has been lower than expected in the last three months, and way below 50 in June. 
ISM Manufacturing PMI NegativeThe employment sub-index for the main survey in the US manufacturing sector came at 47.3, worse than the 50.2 expected, and in the red for the third consecutive month.
University of Michigan Consumer Confidence Index NegativeUS consumer sentiment has collapsed below post-Global Financial Crisis levels, down to 50 in June.
Conference Board Consumer Confidence Index Negative

The Conference Board Consumer Confidence Index® is also going down, back below 100 for the first time since January 2021.

ADP Employment Report ---
US private-sector employment report will not be published during the summer months as ADP re-evaluates the way it estimates the data.
JOLTS Job Openings PositiveThe job openings number is still very close to all-time highs, still above 11M job offers in May.

 

JUNE US JOBS REPORT Review

May US JOBS REPORT Review


April US JOBS REPORT Review


March US JOBS REPORT Review


February US JOBS REPORT Review



January US JOBS REPORT REVIEW

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BIG PICTURE

The NFP report: The most important economic indicator for the US

NFP Definition

NonFarm Payrolls report measures the number of jobs added or lost in the US economy over the last month. It is released usually on the first Friday of each month, at 8:30 EST. It is published by the US Department of Labor.

This report is important because the US is the largest economy in the world and its currency (US Dollar) is the global reserve currency. The many economies peg (tie) their currency's value to the reserve currency, many commodities such as gold and oil are priced in terms of the reserve currency and the local economy's debt is priced in terms of its own currency.

The NFP report, because of its importance to the reserve currency, tends to move all markets: currencies, equities, treasuries, interest rates and also commodities. It does it so immediately after the release of the economic data and sometimes so dramatically.

US Departament of Labor

The mission of the DOL is to assure the prosperity of the wage earners, job seekers which includes more than 10 million employers and 125 million workers in the USA. 180 federal laws and several federal regulations are the key of the Departament Labor promotion of benefits and rights.

To Trade...

Those who advocate trading NFP releases base their advice on a previous preparation and some fundamental research. The elaboration of some macroeconomical analysis is essential for successful trading.

This research includes averages of past headline NFP numbers, Weekly Jobless Claims, ISM Industry Data reports or other employment reports as the ADP or the Challenger. Tracking these events is fundamental on the preparation of the trades to set up just after the release. You can check all this data on FXStreet Economic Calendar: ADP Report, Initial Jobless Claims, ISM Industry Data.

... Or Not to Trade

A lot more skeptical on the benefits of trading the event, as you can read in his article “Step aside the NonFarm Payrolls release”, Adrián Aquaro, President at Trader College, says its importance has decreased a little bit lately:

“Even if the impact has diminished gradually over time, still generates huge attention on the markets and it normally drives important monthly trends. Lately another event (the Fed Monetary Policy Meetings) has been driving similar attention, thanks mainly to the Interest Rates being at 0%.”

What is a NonFarm Payrolls Forecast?

A NonFarm Payrolls Forecast is some sentiment-based piece of content that tries to predict what the NFP numbers will be and what impact will they have on the markets. In this page, you'll find some articles and tools that will help you to understand which could be the outlook for ADP Report, Unemployment Rate, Average Hourly Earnings, Labor Force Participation Rate and some other important economic indicators.

The ADP (National Employment Report) is an estimation of nonfarm employment which is based on a survey of thousands of private sector businesses. One of the biggest differences between NFP data and ADP data is the sample and methodology of the study. ADP Jobs Report could show us an anticipation of the NFP's trends. Some outlooks are mainly based on the Jobs Report, in past data and in other related job indicators like Initial/Continuing Jobless Claims.