Wells Fargo: Jobs Report Not Enough To Lock In Nov Taper

Wells Fargo thinks the sub-par gain in Sept payrolls "will keep the debate alive on when the FOMC will announce their tapering plans", even though they see the report as underscoring "that labor availability remains the biggest challenge to hiring right now".

• "Demand remains exceptionally strong and employers continue to struggle to fill positions, as indicated by the NFIB's measure of businesses with at least one job that is hard to fill rising to yet another record in September. The labor force participation rate edged back down to 61.6%. School reopenings appear to have done little to get workers back to the jobsite, with the prime-age labor force dipping 0.2 points."
• They expect the participation rate to recover in coming months, but highlight that "frictions remain prevalent and the jobs recovery will take time".
• For the Fed, "a November 3 taper announcement remains on the table, but this morning's report was not "decent" enough [referring to Powell's stated criteria] to firmly lock it in...[the] meeting will likely be "live" with a robust debate among participants, and we think it is roughly a 50-50 odds that they announce a taper .... If they do not, a December 15 announcement seems all-but-assured unless the economy completely comes off the rails between now and then. "