From CNN’s Alicia Wallace, Elisabeth Buchwald, Krystal Hur and Nicole Goodkind Futures were slightly higher Friday morning after tumbling on Thursday ahead of the jobs report. Dow futures rose by about 0.2% to 38,995, the S&P 500 was mostly flat at 5,212, and Nasdaq futures were up by 0.2%. On Thursday, the Dow Jones Industrial Average slumped 530 points, or 1.4%, after swinging 800 points during the day. The blue-chip index closed below the 39,000 level for the first time since mid-March. The S&P 500 fell 1.2% and the Nasdaq Composite slid 1.4%. Minneapolis Federal Reserve President Neel Kashkari said Thursday that it’s possible the central bank won’t cut rates this year if inflation remains persistent, spooking investors already concerned that the Fed could delay paring back rates. That adds to what’s already been a rough start to the second quarter, after stocks notched their best beginning to the year since 2019. The S&P 500 has declined 2% for the week after paring back some of its losses on Wednesday. The 10-year US Treasury yield on Tuesday leapt to its highest level since last November. Gold and oil prices are rising. Economists predict the US economy added 200,000 jobs last month, according to FactSet consensus estimates. That would be down from the 275,000 workers added in February and the 229,000 added in January. The unemployment rate is expected to fall to 3.8% in March, but it’s “very foreseeable” that the jobless rate could reach 4%, said Michael Strain, the director of economic policy studies at the American Enterprise Institute. That would signal workers are starting to “lose some of their extremely strong leverage in the labor market,” said Aaron Sojourner, a labor economist at the W.E. Upjohn Institute for Employment Research. Federal Reserve officials will likely be paying close attention to the pace of wage growth. That’s because faster wage growth can usher in higher overall prices since it means consumers have more money to spend. Last month it slowed slightly, and economists are expecting that progress to continue. Here’s what five investors and economists have their eye on ahead of the latest jobs report. Fewer people are quitting their jobs: BLS data released Tuesday showed that February’s quits rate (voluntary separations as a percentage of employment) remained low. Higher quit rates typically correlate to higher wage and price inflation pressures. At the same time, layoff activity hasn’t spiked. Last month, the number of job cuts announced by US-based firms held mostly steady with the activity in March 2023, according to new data released Thursday from outplacement and research firm Challenger, Gray & Christmas. Layoff announcements picked up last month by about 7%. However, that’s an increase of just 0.7% year on year, according to Challenger. Through the first quarter of this year, layoff announcements are down 5% from the first three months of 2023. “Many companies appear to be reverting to a ‘do more with less’ approach,” Andy Challenger, senior vice president of Challenger, Gray & Christmas, said in a statement. “While technology continues to lead all industries so far this year, several industries, including energy and industrial manufacturing, are cutting more jobs this year than last.” The latest weekly jobless claims released Thursday by the Department of Labor released showed that initial applications for unemployment benefits climbed to a nine-week high of 221,000, slightly above expectations. However, the number of people who were already collecting unemployment benefits fell by 19,000 to 1.79 million. Federal Reserve Chair Jerome Powell — like many of his colleagues — thought the unemployment rate would spike after the central bank began its aggressive fight against inflation two years ago. But he couldn’t be happier to have been proven wrong. Now the question is how much longer the labor market will continue to stay as strong as it has. Powell said he’s expecting more “labor market rebalancing,” Powell said at an event hosted by Standford University on Wednesday. By that, he mainly means fewer job openings, which puts less pressure on employers to raise wages. At the same time, he believes the labor market will remain strong as the Fed aims to get inflation down to its 2% target. However, he acknowledged that recent monthly job gains have “come in higher than expected.” That’s one of the reasons the central bank is putting off rate cuts. Demand for workers in the US picked up slightly in February in a sign that the job market remains on strong footing, though layoffs also ticked up that month. There were a seasonally adjusted 8.8 million job openings in February, a notch higher than the prior month’s downwardly revised 8.74 million, the Labor Department reported Tuesday. That was roughly in line with economists’ expectations. The number of available jobs remains well above pre-pandemic levels, but is down from a record high of 12.2 million in March 2022. Openings soared the most in finance and insurance; state and local government excluding education; and arts, entertainment and recreation. Meanwhile, job vacancies dropped sharply in information and federal government. However, while labor demand remains solid, the report also showed some possible signs of a loosening job market. Layoffs rose to 1.72 million from 1.6 million. For the past three years, layoffs have hovered below pre-pandemic levels, but as of February, they were above the lowest point in 2019. The number of hires rose slightly in February to 5.8 million from 5.7 million. The ratio of job openings to the number of unemployed people seeking work, a measure of labor market tightness often cited by Federal Reserve Chair Jerome Powell, fell to 1.36 in February from January’s 1.43. That’s well below the ratio of 2:1 in March 2022, the highest on record, and shows that demand and supply in the job market has become much more balanced over the past two years.
Live updates: March jobs report expected to show slower growth
