US nonfarm payrolls likely increased by 175k in December - Nomura

Research Team at Nomura forecast that US nonfarm payrolls increased by 175k in December, following a steady gain of 178k in November.

Key Quotes

“We expect that private payrolls gained 170k, implying that the public sector added 5k workers to its payrolls. Incoming business and consumer surveys suggest healthy hiring and job market conditions. In addition, initial and continuing claims data imply that involuntary layoffs remain quite low and firms are eager to retain workers.”

“In addition, we expect that unemployment rate increased slightly to 4.7% in December following a 0.3pp decline to 4.6% in November. We think that the influx of workers returning back to the labor market, drawn by steady employment activity, will put enough upward pressure on the unemployment rate. As for wages, we expect average hourly earnings to have rebounded by 0.2% m-o-m (2.7% y-o-y) following a 0.1% decline in November. Sharp swings in earnings in October and November were likely caused by transitory effect of inclement weather. We believe average hourly earnings have returned to trend.”