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US OUTLOOK/OPINION: JPM See 75-100k Drag From Hurricanes and Strikes On NFPs

US OUTLOOK/OPINION
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  • JPMorgan expect that nonfarm payroll growth of 100k in October and private 75k, assuming “that overall nonfarm employment growth is reduced by 75-100k owing to hurricanes and the Boeing machinists strike.”
  • On revisions, “For September, first and second revisions have also tended to be positive, though the first revision was negative in 2023 (-39k), and the second revision was negative in both 2022 (-46k) and 2023 (-34k). Consequently we also see a chance that September could be revised down.”
  • They see the unemployment rate increasing a tenth to 4.2%. “The first item arguing for an increase is simply the prior trend, as the unemployment rate rose 0.9%-pt from the 2023 low to the July high.” They also point to surveys that tend to correlate with the u/e rate rate (labor market differential and NFIB hiring plans), whilst “another reason to think the unemployment rate could go higher is that the quit rate from the JOLTS survey had continued to steadily fall through August, and with the exception of COVID is the lowest since early 2015, a period when the unemployment rate was over 5%.”
  • They also expect AHE growth of 0.3% M/M (4.0% Y/Y) “and the workweek to hold stable at 34.2.”
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  • JPMorgan expect that nonfarm payroll growth of 100k in October and private 75k, assuming “that overall nonfarm employment growth is reduced by 75-100k owing to hurricanes and the Boeing machinists strike.”
  • On revisions, “For September, first and second revisions have also tended to be positive, though the first revision was negative in 2023 (-39k), and the second revision was negative in both 2022 (-46k) and 2023 (-34k). Consequently we also see a chance that September could be revised down.”
  • They see the unemployment rate increasing a tenth to 4.2%. “The first item arguing for an increase is simply the prior trend, as the unemployment rate rose 0.9%-pt from the 2023 low to the July high.” They also point to surveys that tend to correlate with the u/e rate rate (labor market differential and NFIB hiring plans), whilst “another reason to think the unemployment rate could go higher is that the quit rate from the JOLTS survey had continued to steadily fall through August, and with the exception of COVID is the lowest since early 2015, a period when the unemployment rate was over 5%.”
  • They also expect AHE growth of 0.3% M/M (4.0% Y/Y) “and the workweek to hold stable at 34.2.”