Earnings, jobs data to watch in the first week of 2024
With the first trading week of 2024 underway, Yahoo Finance Live is set to cover notable earnings reports while also monitoring key economic data releases. This includes the JOLTS report (Job Openings and Labor Turnover Survey) on Wednesday, ADP private payrolls on Thursday, and the December jobs report on Friday.
Yahoo Finance's Josh Schafer analyzes expectations for the labor market and upcoming jobs data, which will provide crucial insights into the economy's trajectory to start 2024.
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Video Transcript
RACHELLE AKUFFO: It's the first week of trading in 2024, and we've got a ton going on with some lingering earnings sprinkled throughout the week, some fed speak Wednesday, and of course, big data ending with the jobs report on Friday. Here with what we should expect from that first jobs report of the year is our very own Josh Schafer. Happy New Year to you, Josh.
JOSH SCHAFER: Rachelle, Happy New Year. It is 2024, and economists are telling me that the biggest story in 2024 is going to be the labor market. Yes, of course, we're still going to be talking about inflation. But when we think about that soft landing, we need the economy to hold up and we need the labor market to hold up as it has.
So what I'm sitting next to right now is the expectations for the December jobs report. So you can see, this would be a little bit of a tick down with the 168,000 jobs added. That's compared to 199. Unemployment rate would be up slightly, 3.8% from 3.7%. But overall, this picture here fits the narrative we've been talking about of a cooling labor market, but not one that's ice cold. Not one that's going into recession.
But that is what people are watching for in '24, in these first three labor reports we're going to get, or four labor reports we're going to get before the fed's March meeting when a lot of people expect the fed to cut. Because some people think we need to see these numbers come significantly down.
To give you an example of what I'm talking about, we're talking about nonfarm payrolls maybe being $50,000 a month by March. That's something Morgan Stanley has called for if they're going to see a cut come in March. Take a look at that unemployment rate. Currently, at 3.8%. Deutsche Bank thinks that number, this number right here, unemployment at 3.8, could go all the way up to 4.5 when we get a mild recession this year. That's their call, is for a mild recession. So we're going to see big shifts in these numbers if that is to happen.
And then just to give you a sense of what that would look like on the charts here. I mean, we're talking, if nonfarm payrolls came all the way down to 50,000, you can see that's just significantly lower than the hot labor market. We've had, remember, 199,000 last month. And then to give you another graphical look at the unemployment rate, we're currently at 3.7%.
For it to tick up over 4%, maybe closer to 4.5%, we're talking about a significant increase in unemployment here. Again, this is what economists are trying to figure out if we're going to get that slowdown. That is not something that is definitely going to happen. But if we were to go up above four, that seems to be a little bit of a line in the sand where economists are starting to get worried about the unemployment rate going up. Because we know if the unemployment rate starts ticking up month after month, that usually feeds on itself and it can get quite high.
So overall, on Friday, we're looking for more signs of cooling and making sure things aren't getting too cold. It's that porridge, Rachelle. You've got to make sure that it tastes just right. And right now, that's what the data has been giving us. But we'll see what we get this week.
RACHELLE AKUFFO: Indeed. Hoping for that Goldilocks scenario. We'll have to see. I appreciate you breaking all that down for us. Our very own, Josh Schafer.
