The May jobs report is expected to reflect the fastest hiring since August, as companies juggle booming demand, ease trade restrictions and pockets of difficulty across the country to find workers. The April report was also supposed to be strong, but it was a huge disappointment.
There are two key issues we focus on in the report. First, by how much has generous unemployment benefits, ongoing childcare issues, and Covid-19 issues capped hiring over the month. Second, how quickly have wages increased as companies struggle to attract help. This last question is central to determining whether skyrocketing inflation is already anything more than transient.
Economists polled by FactSet predict a 650,000 increase in non-farm payrolls in May, compared to a disappointing 266,000 gain in April. The unemployment rate is expected to have fallen to 5.9% from 6.1% as the participation rate increased slightly, a sign that the unemployment rate is falling for the right reasons.
Wages, meanwhile, are expected to have risen 0.2% from April after jumping 0.7% a month earlier. On an annual basis, this would translate into a rate of 1.6%. We note that the average hourly earnings component of the Monthly Jobs Report does not include the bonuses that many employers offer for recruiting workers.
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Write to Lisa Beilfuss at [email protected]