Zhitong Finance APP learned that the US Department of Labor will release the November non-farm employment report at 21:30 Beijing time on Friday. The market predicts that the US non-farm employment will increase by 200,000 in November, down from 261,000 in October; the unemployment rate is expected to be 3.7%, the same as October; the average hourly wage is expected to increase by 20.3% month-on-month (0.4% in October), and a year-on-year increase of 4.6% (4.7% in October).
If the number of new non-agricultural jobs announced tonight is the same as expected, this will be the lowest level since January 2021. However, given that the average level of the data before the epidemic was in the range of 150,000 to 200,000, this figure will reflect that the labor situation remains healthy based on historical trends. If the U.S. non-farm data cools down in November, it will be something that Fed officials are happy to see. They have been working to suppress the extremely tight labor market, which put upward pressure on wages and caused prices to soar.
US labor participation rate is still lower than pre-epidemic level
However, Friday's non-farm data will not be enough to prevent the Fed from further hiking rate to curb inflation. Although Fed Chairman Powell this week hinted that interest rate hikes will slow as soon as December, he also emphasized that "price stability is the responsibility of the Federal Reserve and the cornerstone of the economy." "Without price stability, we cannot achieve a continued strong labor market situation that is beneficial to everyone." The recent data released by
has shown signs of a cooling of the job market. Data released on Wednesday showed that the number of ADP employment in the United States, known as the "small non-agricultural", increased by 127,000 in November, the lowest level since January 2021, far below the market expectations of 200,000, and fell sharply from 239,000 in October.
However, Ian Shepherdson, chief economist at Pantheon Macroeconomics, questioned the reliability of ADP data, especially after the company revised its data collection method. He believes that the number of new non-farm jobs announced on Friday may be around 250,000. "We have deep doubts about ADP's employment report. It may not be a reliable leading indicator of official employment data."
The layoffs of U.S. companies also seem to indicate that the job market is cooling, especially in the tech industry. However, Brendan Murphy, head of the North American region of the Global Fixed Income Department of Insight Investment, said: "In the past few months, the news of layoffs in the technology industry has been reported, but this has not yet been translated into a significant weakening of the labor market."
US Treasury Secretary Yellen said on Wednesday that non-farm employment data, like inflation data, is the most important data that officials pay attention to. "We don't want to exceed full employment, and we do have inflation problems," she said. "So you can expect economic growth to slow down. We continue to achieve positive growth in the economy, just a sharp slowdown in growth."
Yellen believes that the industry in the tech industry is an exception because the industry faces "special factors", including slowdowns and lower advertising revenues. "What you're seeing is some reduction in future growth, which is driving businesses to rethink the people they really need to hire. So we've seen job openings start to drop," she said.
