A snippet from Deutsche Bank previewing the nonfarm payroll report due at 8.30 am US Eastern time on Friday, 7 July 2023.
With the headline number ranging from +217k to +472k over the last 6 months, these are not currently close to recessionary levels.
- However, the average recession through history has seen payrolls move from an average of just over +100k in the 3-6 months before to very suddenly negative in the first month of the recession where it tends to stay for several months. You don’t tend to get any warning from prior payroll prints that its going to turn negative but with the range this year, and last month being at +339k, we probably need to move down into the 100-200k range before we can be on more near-term recession watch. Even then it still might not happen but that’s probably a necessary condition outside of a shock.
For Friday, our economists expect headline (consensus +225k, DB +200k vs. +339k previously) and private (consensus +200k, DB +175k vs. +283k) payroll gains to slow relative to their three-month averages of +283k and +231k, respectively.
- This should still edge unemployment back down a tenth to 3.7% (consensus 3.6%) after a surprise spike last month.
- Hours worked was weak last month and our economists expect that to bounce from 34.3 to 34.4hrs.
- Hourly earnings are expected to be steady at 0.3%.
- This snapshot from the ForexLive economic data calendar, access it here.
- The times in the left-most column are GMT.
- The numbers in the right-most column are the 'prior' (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected.