Dec 6, 2019

November jobs report could set the tone for the economy in 2020

Expand chart
Data: BLS, ADP; Chart: Andrew Witherspoon/Axios

Most economists polled are on record predicting the U.S. added 150,000 to 180,000 jobs in November, but following Wednesday's ADP private payrolls report, which came in strongly below estimates, some are bracing for a weak number.

The big picture: Cailin Birch, global economist at The Economist Intelligence Unit, expects job creation softened significantly last month and that the economy is slowing — though she sees a "minor risk" of a looming recession.

  • "The prospects for the US economy in 2020 are fairly mediocre; we do not expect business investment to improve until there is greater clarity on the future of US trade policy and the next steps in the US-China trade war, which is unlikely until 2021," she says in an email.
  • "That said, consumer demand shows no sign of flagging, and this should help to shore up overall growth and job creation, preventing a sharper slowdown in 2020."

Yes, but: Some economists expect the jobs report to outpace expectations because of the resolution of the UAW strike at GM plants across the country, putting job gains above 200,000 and giving a boost to lagging manufacturing jobs.

Go deeper: The U.S. services sector is holding on

Go deeper

Private sector adds just 67,000 jobs in November

Private sector job growth slowed last month and added just 67,000 jobs — a big miss from the 150,000 that economists expected, according to the closely-watched report by ADP and Moody’s Analytics.

  • “The job market is losing its shine ... job openings are declining and if job growth slows any further unemployment will increase,” Mark Zandi, Moody’s chief economist, said in a release.

Why it matters: It stokes fears about the health of the labor that’s shown some signs of slowing, but has mostly held up in the face of recession fears. The ADP report is considered a precursor to the government’s official jobs release, which comes on Friday.

Private payrolls dip while government job report soars

Data: BLS, ADP; Chart: Axios Visuals

Last week's ADP private payrolls report was a serious head fake for Friday's blockbuster U.S. jobs report from the Labor Department.

Why it matters: The government's numbers deviate significantly from the trend, which likely mean the report is an outlier but it could also signal the start of a new trend.

Go deeperArrowDec 9, 2019

U.S. economy surprises with 266,000 new jobs in November

Data: Bureau of Labor Statistics; Chart: Axios Visuals

The U.S. economy added 266,000 jobs in November, above the 187,000 economists expected, the government said on Friday, as the unemployment rate fell back to a 50-year low of 3.5%.

Why it matters: The number reflects, in part, striking GM workers returning to work. The report, which also included upward revisions for prior months' job gains, also shows employers haven't pulled back on hiring, despite fears of a trade-war driven economic slowdown.