How the Employment Report influences Wall Street and the economy
The report is based on surveys of households and employers. It estimates the number of people on payrolls in the U.S. economy, the average number of hours they worked weekly, and their average hourly earnings, along with several versions of the unemployment rate.
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The jobs report is among the most important and comprehensive economic releases and the earliest to provide data for the prior month. Its numbers are hotly anticipated and closely parsed as a result.
Many investment firms issue estimates ahead of the report for the monthly change in nonfarm payrolls and the unemployment rate, as well as hours worked and hourly earnings.
The monthly jobs report from the Bureau of Labor Statistics (BLS) estimates the U.S. unemployment rate and the monthly change in nonfarm payrolls, as well as average earnings and hours worked.
The report consists of two main components: the household survey, which is used to estimate the unemployment rate, and the establishment survey providing data on payrolls, hours worked, and earnings.
Released on the first Friday of every month for the prior month, the jobs report gives investors one of the earliest and most comprehensive views into the recent state of the U.S. economy.
Earnings data is used to assess labor cost pressures, while hours worked can be a leading indicator of labor demand. Socioeconomic subcategories in the household survey show which groups are suffering the most and least from unemployment.
The Establishment Survey
The establishment survey, formally called the Current Employment Statistics Survey, gathers data from approximately 122,000 nonfarm businesses and government agencies for some 666,000 work sites and about one-third of all payroll workers. The survey is based on the weekly pay period that includes the 12th day of the month.
Anyone on the payroll of a surveyed business during that reference week, including part-time workers and those on paid leave, is included in the count used to produce an estimate of total U.S. nonfarm payrolls
Farm workers are not included because of agriculture’s seasonal nature; the sector’s reliance on self-employment, unpaid family work, and undocumented workers; and its partial exemption from unemployment insurance requirements, since those records are used to compile the survey sample. The payroll data also does not include self-employed workers
