JPMorgan expects non-farm employment to increase by 150,000 in December

JPMorgan analysts said in a note to clients that they expect nonfarm employment to have increased by 150,000 in December, with the unemployment rate rising a tenth to 3.8%.

Analysts told investors that the labor market has been adding jobs at a solid pace in recent months, with a variety of related variables pointing to continued strength in the labor market.

As a result, the bank expects job growth to remain solid in December.

“That said, the November job gain (199,000) was flattered by the return of about 40,000 formerly striking employees; so, we think that job growth will cool down between November and December,” analysts explained. “More broadly, we also think that the underlying trend in employment growth will keep moderating over time.”

Furthermore, analysts said they believe that the December job growth will be concentrated in a few industries that historically have not been very negatively impacted by higher rates. JPMorgan sees over 80% of the total employment gain in December coming from health care and social assistance and the public sector.

When it comes to wages, the bank forecasts that the tightness in the labor market will keep the upward pressure going, and it forecasts a 0.4% increase in average hourly earnings in December.