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Friday’s jobs report may give mixed view of labor market. What to expect

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The December jobs report is likely to provide only limited clarity on where the labor market is headed, with experts differing on how pronounced a slowdown there is in hiring.

From a consensus view, economists expect the Bureau of Labor Statistics on Friday morning to report a gain of 155,000 in nonfarm payrolls, a step down from the surprising 227,000 increase in November but about in keeping with the four-month average. The unemployment rate is forecast to hold steady at 4.2%.

However, the details of the report will be key, with some on Wall Street expecting that the number could come in a bit weaker, depending on how seasonal trends and other factors play out.

“We’ve seen a little bit of the softening and I think we’ll continue to see that, but it’s still a good [labor] market overall,” said Maureen Hoersten, chief operating officer and interim CEO at LaSalle Network, a Chicago-based staffing firm. “Things are leveling off a little bit. People are still a tad cautious, trying to figure out this new year and the new economic climate and political climate,” she said.

On average, the economy in 2024 added about 180,000 jobs a month through November, though the data has been volatile and somewhat confusing lately. Federal Reserve Governor Michelle Bowman complained Thursday that labor market reports “have become increasingly difficult to interpret” due to measurement challenges, which have included a surge of new workers and low response rates on surveys.

The December report also could be harder to judge depending on how the hiring of holiday workers affects the numbers.

Goldman Sachs, for one, estimates that payroll growth will come in at just 125,000, with the unemployment rate drifting up to 4.3%.

“Our forecast reflects a rebound in the labor force participation rate and middling household employment growth amid more challenging job-finding prospects,” the Wall Street bank said in a note. “We expect deceleration in job growth in non-retail sectors, particularly professional services and construction, to more than offset stronger retail hiring this month.”

Similarly, Citigroup is predicting just 120,000 new jobs and a 4.4% unemployment rate, which economist Andrew Hollenhorst wrote “should remind markets that the labor market has not stabilized and is continuing to soften. Risks are balanced to an even softer reading.”

However, Hoersten said she thinks that once some of the current volatile factors subside, companies will continue adding headcount, even if at a gradual rate. A BLS report earlier this week put job openings in November at a six-month high of just over 8 million, while layoffs were little changed and the quits rate, a measure of worker mobility, declined.

At the December meeting of the Federal Reserve, officials noted an “ongoing gradual easing in labor market” conditions, but saw “no signs of rapid deterioration,” according to minutes released Wednesday.

In a recent business survey, LaSalle Network found that 67% of small- and mid-size companies plan to increase headcount in 2025, down from 74% the year before. The survey also found that salary increases are expected to be smaller and hybrid working is likely to remain prevalent as a wedge to compete against larger companies for workers.

Average hourly earnings are expected to show a 0.3% increase in December and an annual rate of 4% from a year ago, little changed from November.

“Right now, I think things are just going to stay fairly flat overall, nothing drastic one way or the other,” Hoersten said. “But I do believe it’s still a good, strong market, and companies just needed to get past the little bit of a crazy climate over the past couple months and get back to the steady state.”

Economics

Andrew Bailey on why UK-U.S. trade deal won’t end uncertainty

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Bank of England Governor Andrew Bailey attends the central bank’s Monetary Policy Report press conference at the Bank of England, in the City of London, on May 8, 2025.

Carlos Jasso | Afp | Getty Images

Bank of England Governor Andrew Bailey told CNBC on Thursday that the U.K. was heading for more economic uncertainty, despite the country being the first to strike a trade agreement with the U.S. under President Donald Trump’s controversial tariff regime.

“The tariff and trade situation has injected more uncertainty into the situation… There’s more uncertainty now than there was in the past,” Bailey told CNBC in an interview.

“A U.K.-U.S. trade agreement is very welcome in that sense, very welcome. But the U.K. is a very open economy,” he continued.

That means that the impact from tariffs on the U.K. economy comes not just from its own trade relationship with Washington, but also from those of the U.S. and the rest of the world, he said.

“I hope that what we’re seeing on the U.K.-U.S. trade side will be the first of many, and it will be repeated by a whole series of trade agreements, but we have to see that happen of course, and where it actually ends up.”

“Because, of course, we are looking at tariff levels that are probably higher than they were beforehand.”

Trump unveils United Kingdom trade deal, first since ‘reciprocal’ tariff pause

In Bank of England’s Monetary Policy Report released Thursday, the word “uncertainty” was used 41 times across its 97 pages, up from 36 times in February, according to a CNBC tally.

The U.K. central bank cut interest rates by a quarter percentage point on Thursday, taking its key rate to 4.25%. The decision was highly divided among the seven members of its Monetary Policy Committee, with five voting for the 25 basis point cut, two voting to hold rates and two voting to reduce by a larger 50 basis points.

Bailey said that while some analysts had perceived the rate decision as more hawkish than expected — in other words, leaning toward holding rates elevated than slashing them rapidly — he was not surprised by the close vote.

“What it reflects is that there are two sides, there are risks on both sides here,” he told CNBC.

“We could get a much more severe weakness of demand than we were expecting, that could then pass through to a weaker outlook for inflation than we were expecting.”

“There’s a risk on the other side that we could get some combination of more persistence in the inflation effects that are gradually working their way through the system,” such as in wages and energy, while “supply capacity in the economy is weaker,” he said.

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Economics

Trump knocks down a controversial pillar of civil-rights law

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IN THE DELUGE of 145 executive orders issued by President Donald Trump (on subjects as disparate as “Restoring American Seafood Competitiveness” and “Maintaining Acceptable Water Pressure in Showerheads”) it can be difficult to discern which are truly consequential. But one of them, signed on April 23rd under the bland headline “Restoring Equality of Opportunity and Meritocracy”, aims to remake civil-rights law. Those primed to distrust Mr Trump on such matters may be surprised to learn that the president’s target is not just important but also well-chosen.

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Economics

Harvard has more problems than Donald Trump

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A Programme at Harvard Divinity School aspired to “deZionize Jewish consciousness”. During “privilege trainings”, working-class Harvard students were instructed that, by being Jewish, they were oppressing wealthier, better prepared classmates. A course in Harvard’s graduate school of public health, “The Settler Colonial Determinants of Health”, sought to “interrogate the relationships between settler colonialism, Zionism, antisemitism, and other forms of racism”: Will these findings by Harvard’s task-force on antisemitism and anti-Israel bias, released on April 29th, shock anyone? Maybe not. Americans may be numb by now to bulletins about the excesses, not to say inanities, of some leftist academics.

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