Wolfe Sees Above-Consensus Payroll Growth in August

Wolfe Research has made a prediction about the upcoming August nonfarm payrolls data. The firm forecasts an increase of 65,000 jobs, which is above the consensus estimate of 55,000.

This forecast includes 75,000 private sector jobs and a decline of 10,000 government positions. Wolfe Research attributes some weakness in hiring to seasonal factors and a reversal of World Cup effects, but expects seasonal patterns to support the industry starting in August, penciling in 5,000 jobs for the sector.

The firm also estimates that average hourly earnings will grow by 0.35% month-over-month, exceeding the consensus estimate of 0.2%. This would slow the year-over-year rate to 3.1% from 3.2% in July.

The labor force has declined by approximately 2.5 million this year, with 1 million of that drop occurring in the past two months. Wolfe Research expects a partial reversal of this decline, which would contribute to the slightly higher unemployment rate of 4.16% from 4.09% in July.