February Payrolls Preview: Watch The "Hours Worked"

Zero Hedge | 3/8/2018 | Staff
Kota79Kota79 (Posted by) Level 4
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With the February jobs report due at 830am ET on Friday morning, here is a recap of Wall Street expectations.

While recent macro economic data has been solid, and suggests a strong number, remember: nobody cares about the actual payrolls number any more, after all the US is about to have sub-4% unemployment with over 95 million Americans not in the labor force. The only thing that matters is what is the average hourly earnings, and whether in February the BLS can pull off the same trick it did last month when it was hours worked that dropped, giving the market the impression that hourly pay had risen when actually just the denominator shrank.

Wages - Thing - Wages - Intention - Wages

And even if actual wages don't rise, and they probably won't, the other thing to remember is that wages aren't actually important - so ignore all you read above - what is important is the "intention" to raise wages, something company CEOs have learned very well.

The man who predicted the collapse of GM, Fannie, and Freddie says the next big bankruptcy is going to catch everyone by surprise. Learn more here.

Below - Summary - Wall - Street - Expectations

Below is a quick summary of Wall Street expectations via RanSquawk and Goldman.

PAYROLL TRENDS: Trend rates remain firm. Payroll growth has averaged 176k/month over the last 12-months, 180k/month over the six-months, and 192k/month over the last three-months, and the consensus view expects 200k in February.

PAYROLL - GROWTH - ADP - Increase - February

PAYROLL GROWTH: ADP reported another solid increase in February (235K vs expected 193K; previous revised up), above what was suggested by surveys and hard data. Pantheon Macroeconomics says that it may imply that the third element of ADP's model (the data which ADP collects itself from firms that use its payroll services) was stronger than expected. Accordingly, Pantheon's forecast for NFP has been nudged up to 225K from 200K.

EARNINGS GROWTH: The February CB Consumer...
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