January jobs report expected to show that hiring slowed last month

All eyes will be on the January jobs report, released Friday morning, as investors look for clues about the health of the labor market in the face of rising interest rates and persistently high inflation.

A high-stakes January for the Department of Labor salary reportThe 8:30 a.m. ET announcement will show that employment rose by 180,000 last month and the unemployment rate edged up to 3.8%, according to the median estimate of Refinitiv economists. It is expected that

it is, Increased by 216,000 in December An average monthly increase of 225,000 was recorded over the past 12 months.

“The consensus in January’s jobs report is that job growth will slow and fall short of December’s 216,000 increase,” said Mark Hamrick, senior economic analyst at Bankrate. .

Workers are now asking for nearly $80,000 to start new jobs

of federal reserve The report comes as policymakers seek to ensure continued easing of inflation, providing evidence that the labor market is finally softening after months of surprisingly strong job growth. The books are carefully monitored. The consumer price index has cooled significantly in recent months, but remains above the Fed’s recommended 2% target despite 11 interest rate hikes in 16 months.

Has the Federal Reserve finished raising interest rates?

Slower job growth and further deceleration in wage growth could be welcome signs for the U.S. central bank, which has kept interest rates on hold for the fourth straight month since Wednesday’s meeting. Policymakers have signaled that the tightening campaign is over and that they are prepared to cut rates, although not immediately.

Average hourly wages, a key indicator of inflation, are expected to increase by 0.3% in the month and 3.8% from the same period last year.

Construction workers are seen at a site in Miami on May 5, 2023. (Joe Radle/Getty Images/Getty Images)

“While we do not expect the January report to change Fed officials’ view that they support cautious easing of monetary policy in the coming months, we do not believe that the January report will change Fed officials’ view that they support a cautious easing of monetary policy in the coming months, but we believe that strong employment growth and “Wage growth above 4% will encourage some hawkish communications.”

But Boussall cautioned that the data could contain some “noise” due to annual benchmark revisions in which the Department of Labor updates seasonally adjusted factors and adjusts them to the latest population estimates from the Household Survey. did.

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The labor market has remained historically tight over the past year, contrary to economists’ predictions of an economic slowdown. Economists say the economy is starting to slow from last year’s breakneck pace, but is far from breaking.

A separate report released Thursday by Challenger, Gray & Christmas found that the pace of job cuts by U.S. employers accelerated in early 2024.

US job fair

Job seekers visit a booth during the Spring Job Fair at the Las Vegas Convention Center on April 15, 2022 in Las Vegas. (KM Cannon/Las Vegas Review Journal/Getty Images)

According to the company’s survey results, companies planned to cut 82,307 jobs in January, a significant 136% increase from the previous month. However, compared to the same period a year ago, it has decreased by about 20%. This was the second-highest January layoff total in data dating back to 2009.

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Data shows the labor market is easing despite increasing headwinds.