Happy July 4th!
A couple of NFP forecasts …
Our June Private Payrolls tracking model ended the month at 124k, a rebound from a dismal reading in May but still below the strong pace of job growth seen previously. We note that our model does not take into account strike workers returning to work in June. Adding back the striking workers to payrolls, we forecast that nonfarm payrolls grew by 160k in June … we expect the unemployment rate to be unchanged at 4.7%. Last, we expect another month of steady wage gains and forecast a 0.2% m-o-m (+2.7% y-o-y) increase in average hourly earnings in June.
From Merrill Lynch:
We expect the June jobs report to reveal a rebound in nonfarm payroll growth to 180,000, following the slowdown in hiring over the last few months. In the last report, payrolls were biased lower by 35,000 due to the Verizon strike. Accounting for a reversal of this effect, true job growth in June would be 145,000. … The unemployment rate likely ticked up to 4.8% from 4.7% … We look for another 0.2% pick-up in wages, which would push up the yoy rate by 0.2pp to 2.7%—the highest pace in this cycle.
Note that the Verizon strike subtracted from the May report and the workers will be added back in the June report. The June employment report will be released on Friday, and the consensus is for an increase of 180,000 non-farm payroll jobs added in June, up from the 38,000 non-farm payroll jobs added in May. The consensus is for the unemployment rate to increase to 4.8%.