Goldman Sachs Sees 75k Payroll Boost and 4.3% Unemployment Rate for July

Goldman Sachs Research has previewed its expectations for the US July jobs report, which is due on Friday. The firm expects a significant increase in payrolls, with an estimated 75k new jobs added to the economy. This boost is attributed to the unwinding of World Cup hiring, which only started after the reference period in July. However, Goldman Sachs also notes that payrolls have consistently missed consensus expectations in July in recent years and that there may be large negative revisions to job growth for prior months.

The firm predicts a 0.1 percentage point (pp) rise in the unemployment rate to 4.3%, which is due in part to modest upward pressure from compositional effects related to the reversal of June's large decline in participation. Goldman Sachs also forecasts a 0.3% increase in average hourly earnings, reflecting neutral calendar effects.