(NEW YORK) — A long-awaited jobs report to be released on Thursday will offer the latest look at the health of the labor market at a fraught moment for the U.S. economy.
Hiring slowed sharply over the summer, before a government shutdown paused the release of gold-standard federal data for weeks on end. A stock market selloff over recent days underscored the uncertainty looming over the economy as some investors warn of an AI bubble.
Economists expect the U.S. to have added 50,000 jobs in September, which would mark an acceleration from 22,000 jobs added in August, according to a Morningstar analysis of FactSet data.
Still, the anticipated figure would come in well below an average of 97,000 jobs added over the first six months of this year.
Mass layoffs at corporate giants like Amazon, UPS and Verizon in recent weeks have drawn attention to a sluggish labor market — and stoked fears that job losses may spread.
It is likely too early to panic, however, some economists previously told ABC News. While the layoffs reflect a weakened labor market and AI adoption in some corners of the tech industry, they added, the prospect of wider job losses remains highly uncertain.
Inflation has picked up in recent months while hiring has slowed, posing a risk of an economic double-whammy known as “stagflation.”
Those economic conditions have put the Federal Reserve in a bind, since the central bank must balance a dual mandate to keep inflation under control and maximize employment.
“We have the situation where the risks are to the upside for inflation and to the downside for employment. We have one tool,” Fed Chair Jerome Powell said at a press conference in Washington, D.C., last month. “You can’t address both of those at once.”
Still, Powell said, concern has tilted toward strain in the labor market, prompting the central bank to reduce interest rates a quarter of a percentage point at each of its last two meetings.
“A further reduction of the policy rate in December is not a foregone conclusion — in fact, far from it,” Powell told reporters.
Traders peg the chances interest rates will be left unchanged next month at about 66%, while the odds of a quarter-point rate cut stand at 33%, according to the CME FedWatch Tool, a measure of market sentiment.
On Wednesday, the Bureau of Labor Statistics (BLS) said it would not release a full jobs report for the month of October due to lost capacity during the shutdown. Rather, partial jobs data for October will be released as part of the November report, the BLS said.
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