America’s unemployment rate could match its lowest point in half a century when the Labor Department releases the May jobs report at 8:30 a.m. ET on Friday.
Here’s what to watch.
1. How low can we go? Unemployment stands at 3.9%, the lowest since 2000. If the unemployment rate dips to 3.8%, it will tie the lowest level since 1969 — a milestone in the recovery from 10% unemployment in 2009. Economists polled by Thomson Reuters predict the unemployment rate will hold at 3.9% after a steeper fall than expected last month.
2. Payroll gains: Employers have tacked on about 200,000 jobs a month, on average, in 2018. Economists predict a gain of 188,000 in May. Businesses are having a tough time finding qualified workers, and economists believe that will hold the number down. “It’s not clear how much better the job market can really get. We’ve already come so far. We’ve drained most of the slack,” said Josh Wright, chief economist at software firm iCIMS.
3. Wages inching up: Wage growth has firmed up in recent months. Economists project wages in May to climb 0.2% from April and 2.7% compared with the same point last year. Economists have argued that employers will offer better pay to workers as the labor market continues to tighten. “Many firms responded to talent shortages by increasing wages,” the Federal Reserve said in a survey on Wednesday.
4. Where are the workers? Professional and business services and the health care industry have anchored job gains during the recovery. Economists expect another strong month for both. Manufacturing has had a solid run over the past few months as the economy expands. “It will be interesting to see if that can maintain momentum,” Wright said.
CNNMoney (New York) First published June 1, 2018: 12:01 AM ET