Written by Kris Garlewicz, CFP® – ProsperiFi
With this October beginning on a Friday, we’ll have to wait an extra week to see one of the more anticipated economic reports on employment. No reason to be concerned though, this is just a matter of timing of data collection. September results will be reported on October 8th to see what happened with jobs nationally.
The crowd is estimating 513,000 jobs were created in September and the unemployment rate dropping to 5.0% from 5.2%. While we don’t spend much time coming up with a forecast, I suspect consensus forecasts may come up short for the next few months.
So far for 2021, monthly payrolls are up 583,000 per month and it’s possible the bean counters are just assuming much of the same continues. Here is what I believe is being missed: most of the national Covid-19 benefits ended on Labor Day weekend.
It’s been argued that the excess payments have created a disincentive to work, and there may by truth to this narrative. We’ll see how that shakes out in the next batch of reports. It’s entirely possible we see a doorbuster 1,000,000+ jobs month by Christmas of this year. More so, the unemployment rate may not move all that much given the return of workers to the labor force will also increase the labor pool figure.
The summer surge of Covid cases (and hospitalizations) along with the rollout of the child credit may explain the muted expectations for October; but with the Government stepping aside, I anticipate much larger beats to the upside in coming months.
Finally, this is not necessarily new job creation, but a much-needed healing of the jobs landscape from the impacts of the Covid disaster. You can find the monthly release here https://www.bls.gov/news.release/empsit.nr0.htm
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