by Calculated Risk on 6/01/2023 02:34:00 PM
On Friday at 8:30 AM ET, the BLS will release the employment report for May. The consensus is for 180,000 jobs added, and for the unemployment rate to increase to 3.5%.There were 253,000 jobs added in April, and the unemployment rate was at 3.4%.
payroll growth well above levels needed to offset the pace of natural growth in the labor force, thereby putting downward pressure on the unemployment rate in an already tight labor market … we expect the unemployment rate to remain at 3.4%”
From Goldman Sachs following the strong ADP report:
o ADP Report: The ADP employment report showed 278,000 private sector jobs were added in May. This suggests job gains well above consensus expectations, however, in general, ADP hasn’t been very useful in forecasting the BLS report.
o ISM Surveys: Note that the ISM services are diffusion indexes based on the number of firms hiring (not the number of hires). The ISM(R) manufacturing employment index increased in May to 51.4%, up from 50.2% last month. This would suggest about 10,000 jobs lost in manufacturing. The ADP report indicated 48,000 manufacturing jobs lost in May.
The ISM(R) services employment index for May has not been released yet.
o Unemployment Claims: The weekly claims report showed a decline in the number of initial unemployment claims during the reference week (includes the 12th of the month) from 246,000 in April to 225,000 in May. This suggests fewer layoffs in May than in April.