Daily Spotlight: Previewing Friday's Jobs ReportOn Friday, the Bureau of Labor Statistics (BLS) likely will provide further evidence that the U.S. job market is healthy. The bigger question is whether the Employment Situation is strong enough to match the 333,000 nonfarm jobs created in December and the 353,000 in January. We believe the job market is strong, but not that strong. In a speech at Princeton University last month, Fed Governor Lisa Cook said that "a range of indicators suggest continued strength in the labor market but also areas worth monitoring for softening demand." The layoffs that make occasional headlines really aren't showing up in the numbers. The four-week average of initial jobless claims is running at 212,500, below the 300,000 that might signal a critical weakening in the job market. The Layoffs and Discharges series in the BLS Job Openings and Labor Turnover Survey (JOLTS) was 1.6 million for December, below the average of 1.925 million since late 2000. "Layoffs and claims for unemployment insurance remain low, implying that all the slowing in labor demand thus far has been along the hiring margin," Dr. Cook said. Job openings and hires, in the JOLTS report, and average weekly hours, in the employment situation report, have declined. Dr. Cook also noted there were signs of "gradual cooling" in the employment cost index for the private sector, which rose 4.1% on a 12-month basis in December, down from 5.1% over the previous 12 months. The January ADP National Employment Report, which tracks private sector hiring, also noted that pressure on wages continues to ease. We expect the employment report on Friday will show that February payroll growth moderated to 185,000, while the unemployment rate remained at 3.7%. We expect growth in average hourly earnings fell by one-tenth to 4.4%, and average hours rose to 34.3 from 34.1, which may have been depressed by January weather.