August US employment report: Steady as she goes

For the August employment report, scheduled for release on Friday, September 4, nonfarm payrolls is set to rise by 225k. Within this, private payrolls is expected to print at 220k and government employment to have expanded by 5k. Initial jobless claims were up 22k in the August reference week from the same period last month, though this increase as a reflection of the anomalously low July reading, the monthly average of initial claims looks to be little changed in August.

 Continuing jobless claims were flat between the July and August survey weeks. Together, stable jobless claims lead us to look for a near-trend pace of payroll growth of 225k in August. Additional factors support the outlook which includes two consecutive monthly declines in part-time employment for economic reasons, as well as positive momentum in the employment diffusion index.

"We expect this pace of employment growth to push the unemployment rate down one-tenth to 5.2%. Elsewhere, we forecast average hourly earnings to have risen 0.2% m/m and 2.0% y/y. Finally, we look for average weekly hours to remain unchanged at 34.6", says Barclays."