Jobs, Jobs, Jobs: What Wall Street Expects

Today's sellside NFP estimate, from top to bottom:

  • Deutsche Bank 225K
  • Goldman Sachs 200K
  • UBS 195K
  • Bank of America 180K
  • Barclays 175K
  • JP Morgan 175K
  • HSBC 165K
  • Citigroup 175K

Consensus is 185K, with a low of 87K, high of 225K (LaVorgna), June printing at 195K and May 165K. The Unemployment Rate Consensus is 7.5%, with a low 7.4% (LaVorgna), high 7.7% and June at 7.6%, May 7.5%.

Some more thoughts on the imminent print from Ransquawk:

For today's reading, the bulk of estimates lie between 165k to 225k, which indicates that jobs growth could stay along the current trend of around 195K as has been observed over the past quarter. Nevertheless, the average remains at near 200k (a figure many on the Fed have signalled indicates a consistently solid improvement in the labour market) for a fourth consecutive month but with global markets in thrall to the Federal Reserve's plans to slow its asset purchases, today's release once again has the potential to shift expectations of a near-term wind-down of the Fed's current program of large scale asset buys. There is a general expectation that this month's payroll number may receive a boost from automakers shutting down fewer plants than normal to prepare the  assembly lines for producing next year’s models, with this same effect being attributed to the reason behind a fall in this week's lower initial jobless claims which came in at lowest since January 2008.

Last month’s Nonfarm Payrolls unexpectedly beat expectations to come in at 195k vs. Exp. 165k with the unemployment rate remaining at 7.6% vs. Exp. 7.5%. The reading was particularly impressive given the historical weakness seen on June’s NFP as a result of difficulty in seasonally adjusting data. More recently, Wednesday’s surprisingly higher than expected ADP private sector jobs report showed a 200k increase in jobs against the 180k expected (Prev. 188k, Rev. 198k). It's worth noting that recently the ADP jobs report has proved less useful as a guide to payrolls, since the start of using new methodology in October. In a similar vein to ADP, yesterday's ISM Manufacturing employment component was the highest since June 2012, and purchasing managers in the services sector, which notably been the source of jobs growth in 2013, reported a stronger hiring rising strongly from 50.1 in May to 54.7 in June.