NonFarm Payrolls

Nonfarm Payrolls rise 850K

US jobs report post-release checklist – Jun 4th, 2021

NFP Actual, Consensus and Deviation Positive The US economy added 850K jobs in June, much better than the 700K expectations.
NFP Revisions Positive May figure revised upwards from 559K to 583K.
Unemployment rate Negative

U3 unemployment rate retraced a bit, rising unexpectedly from 5.8% to 5.9%. U6 underemployment rate down below 10% for the first time since the pandemic struck.

Labor Force Participation Rate Neutral The share of people in the workforce stayed at 61.6%.
Average Hourly Earnings Neutral Monthly wage gains stable at 0.3%, yearly wages back to regular growth levels at 3.6%, just a tick below the 3.7% expected.



US jobs report pre-release checklist – Jul 2nd, 2021

Previous Non-Farm Payrolls Negative The US economy added 559K jobs in May, worse than the 650K expected.
Challenger Job Cuts Positive US corporate layoffs were just 20,476K, setting a new multi-year low in June. 
Initial Jobless Claims Positive First-time employment claims continue their decline, with jobless petitions 4-week moving average falling below 400K for the first time since the pandemic struck.
Continuing Jobless Claims Neutral The unemployment-benefit claimants' downtrend has slowed down, but claims have fallen below 3.5M in June for the first time since the covid pandemic.
ISM Services PMI Negative The employment section of the US main service sector survey dipped in May to 55.3 after hitting a three-year peak in April.
ISM Manufacturing PMI Negative The manufacturing sector of the US economy seems to be slowing down, as the ISM Manufacturing Employment index has dipped down just below 50, back to contraction territory.
University of Michigan Consumer Confidence Index Neutral The UMich consumer sentiment survey is still on an uptrend but printed a worse-than-expected 85.5 rating in June.
Conference Board Consumer Confidence Index Positive The Conference Board Consumer Confidence Index® is showing more clearly the US consumer optimism, as the index has recovered above 125, nearing its pre-pandemic levels.
ADP Employment Report Positive
Private sector employment gains showed a 978K job gain in May, an excellent figure that hints at a strong NFP report if high correlation between the two is to be confirmed.
JOLTS Job Openings Positive Although lagging by nature, the JOLTS indicator is reaching all-time highs, printing over 9M openings in April as US employers look to fill their payrolls. 




Breaking: US adds 266,000 jobs in April vs. 978,000 expected

Nonfarm Payrolls (NFP) in the US rose only by 266,000 in April, the data published by the US Bureau of Labor Statistics showed on Friday. This reading followed March's increase of 770,000 (revised from 916,000) and missed the market expectation of 978,000 by a wide margin.






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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.