Today's strong ADP employment report caught the market's attention, despite the spotty track record from ADP. That likely put an upward bias into estimates ahead of the release, which is out at 8:30 am ET on Friday.
- Consensus estimate +200K (high +350K, low +130K)
- Private +180K
- November +263K
- Unemployment rate consensus estimate: 3.7% vs 3.7% prior
- Participation rate prior 62.1% (no consensus estimate)
- Prior underemployment U6 6.7%
- Avg hourly earnings y/y exp +5.0% y/y vs +5.1% prior
- Avg hourly earnings m/m exp +0.4% vs +0.6% prior
- Avg weekly hours exp 34.4 vs 34.4 prior
Here's the December jobs story so far:
- ADP employment 235K vs 150K
- ISM manufacturing employment 51.4 vs 48.3 prior
- Challenger Job Cuts rose 129.1% y/y in December vs November’s 416.5%
- Philly employment -1.8 vs +7.1 prior
- Empire employment +14.0 vs +12.2 prior
- Initial jobless claims survey week 216K vs 222K expected
- ISM services employment not yet released
Seasonally, there isn't a big bias. According to BMO: Seasonally the headline payrolls print has a tendency to miss forecasts in December coming in below estimates 54% of the time and beating 46% of the time. The average downside miss is 86k and upside miss is 71k.
This is a market that's begging for direction and bad news is good news.
