10Y dollar economy jobs NFP unemployment

Jobs Report Misses Badly, Earnings Beats ‘Bigly’

U.S. Sept. Nonfarm Payrolls Fell 33k Avg. hourly earnings 0.5% m/m, est. 0.3%, prior 0.2%


That’s the fastest Y/Y AHE growth since the crisis:


Bill Gross just called a December hike a “slam dunk.”


Ok, who’s ready for a completely meaningless jobs report?

As you know, payrolls will be distorted by hurricane effects, so there’s not much to be divined here. We wrote a little bit about this earlier (here) and a lot about this in our week ahead preview (here), but suffice to say the focus will be on the AHE print.

As far as the reaction goes, this is all about whether traders will find an excuse to spin the data as supportive of the whole “reflation resurgence” narrative that’s accompanied tax reform “hope” and the perception that the Fed is set to stay the course on normalization (if only to give itself some countercyclical breathing room so they can start easing again later).

Here are the estimates and priors:

  • Change in Nonfarm Payrolls, est. 80,000, prior 156,000
  • Change in Private Payrolls, est. 74,000, prior 165,000
  • Change in Manufact. Payrolls, est. 10,000, prior 36,000
  • Unemployment Rate, est. 4.4%, prior 4.4%
  • Average Hourly Earnings MoM, est. 0.3%, prior 0.1%
  • Average Hourly Earnings YoY, est. 2.5%, prior 2.5%
  • Average Weekly Hours All Employees, est. 34.4, prior 34.4
  • Labor Force Participation Rate, prior 62.9%
  • Underemployment Rate, prior 8.6%

And here are the numbers, just out:

  • U.S. Sept. Nonfarm Payrolls Fell 33k


  • Nonfarm payrolls, net revisions, -38k from prior two months
  • Participation rate 63.1% vs prior 62.9%
  • Avg. hourly earnings 0.5% m/m, est. 0.3%, prior 0.2%
  • Y/y 2.9%, prior 2.7% est. 2.6%
  • Nonfarm private payrolls fell 40k vs prior 164k; est. 75k, range -25k-150k from 39 economists surveyed
  • Manufacturing payrolls fell 1k after rising 41k in the prior month; economists estimated 10k, range -10k to 20k from 20 economists surveyed
  • Unemployment rate 4.2% vs prior 4.4%; est. 4.4%, range 4.3%-4.6% from 79 economists surveyed
  • Underemployment rate 8.3% vs prior 8.6%
  • Change in household employment 906k vs prior -74k

The knee-jerk (clearly a reaction to AHE):



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