NonFarm Payrolls

US labor market conditions loosen as participation rate improves

US jobs report post-release checklist – March 10th, 2023

U3 unemployment rate came slightly worst than expected with 3,6%, also the U6 underemployment came lower than expected, with 6.8%.

NFP Actual, Consensus and Deviation Positive The US economy added 311K in January, much better than the 205K expected.
NFP Revisions Negative NFP November report revised to 504K from 517K.
Unemployment rate Negative
Labor Force Participation Rate Positive The share of people in the workforce has slightly increased to 62.5%.
Average Hourly Earnings Negative Montly change in wages sllightly increased to 34.5&, while yearly wages also decreased to 4.6%.



US jobs report pre-release checklist – March 10th, 2023

Previous Non-Farm PayrollsPositiveThe US economy added 517K in January, much better than the 185K expected.
Challenger Job CutsPositive
The number of corporate layoffs downed to 77.77K in February from 102.943K in January.
Initial Jobless Claims NegativeThe last Jobless Claims release came higher than expected, with the week ending on March 3rd seeing 211K first-time claimers.
Continuing Jobless Claims NegativeThe number of employment seekers is now around 1.718M, still close to its all-time low.
ISM Services PMI PositiveEmployment sub-index came in at 54 in February, pointing to a jobs growth in the service sector.
ISM Manufacturing PMI NegativeThe employment sub-index for the main survey in the US manufacturing sector came in at 47.7 slightly worst than the 48 expected.
University of Michigan Consumer Confidence Index PositiveConsumer confidence in the US slightly improved in February following the growth seen in January.
Conference Board Consumer Confidence Index Negative

The Conference Board Consumer Confidence Index® decreased in February for the second consecutive month. The Index now stands at 102.9, down from 106.0 in January (a downward revision).

ADP Employment Report PositiveEmployment in the US private sector increased to 242.000 in February, compared to the market expectation of 200,000.
JOLTS Job Openings NeutralJob openings on the last business day of January was 10.8 million, compared to 11.2 million in December.






September US JOBS REPORT Review


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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.