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Latest Labor Market Indicators Ahead Of Payrolls


Updating the labor market pack of alternate indicators from the MNI Payrolls Preview (original full preview here) after yesterday’s labor data deluge.

  • Upside: ADP private employment provided by far the largest upside surprise at 497k (cons 225k) in June even if some questioned whether it was distorted by a favorable seasonal adjustment. It was the highest print since Feb’22.
  • ISM services employment increased 3.9pts to 53.1 in June for its highest since February, belying the renewed drop in the much smaller-weighted manufacturing component.
  • The Conf Board labor differential increased from 30.7 to 34.4 in June as it bounced back nearer the ~36.5 averaged in the prior two months. It was led by “jobs plentiful” whilst “hard to get” dropped back slightly having increased to its highest since Nov back in May.
  • Mixed: JOLTS saw job openings fall slightly more than expected in May after an upward April, leaving the ratio of openings to unemployed at its lowest since Oct’21. However, quit rates bucked the recent normalization trend and increased to highs since December.
  • Downside: Initial jobless claims have been particularly noisy of late, jumping to a seasonally adjusted 260-265k in the first half of June before dropping back to two weeks averaging 242k. The reference week landed in the higher period though, at which point the four-week average was tracking at 256k from 232k at the prior reference week. That would ordinarily imply downward pressure on employment growth in June although it’s caveated by a steady decline in continuing claims over the same period.

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