Week Ahead on Wall Street: Full Employment
By: Mario Ismailanji · June 03, 2024 · Reading Time: 4 minutes
Sweet Spot
Summer is here – if not officially, certainly in spirit! The days are getting longer and filled with more sunlight, but if we look at the labor market, the status quo might just continue.
This Friday’s jobs report will get most of this week’s attention, but investors will also get a look at the latest Job Openings and Labor Turnover Survey (JOLTS). The survey includes how many jobs are waiting to be filled in America, which the Federal Reserve has highlighted as a key measure of demand for workers. Also included are interesting data points such as the rate at which workers voluntarily quit or get laid off, as well as the rate at which employers hire new workers.
If workers are quitting their jobs and employers are hiring new workers at a higher rate, or if the layoff rate is falling, it implies a hotter labor market. But last we looked, the data showed the quits rate is down at 2017 levels, the hires rate is down to 2014 levels, and the layoff rate is hovering at 24-year lows. In other words, the labor market seems to be in a state of calm, where workers are staying put, and companies aren’t hiring or laying people off a lot. Amid all this, the unemployment rate continues to be relatively low, too.
Last week’s surprise rise in consumer confidence was driven by the perception of the job market, as consumers continue to note that while jobs are less plentiful than they were a couple years ago, they’re not yet that hard to get. America’s labor market hasn’t gone from hot to cold. It’s juuust right, at least for now.
Economic and Earnings Calendar
Monday
• April Construction Spending: Construction data is a leading indicator of business activity.
• May ISM Manufacturing PMI: This index from the Institute for Supply Management tracks how purchasing managers across the manufacturing sector feel about the business environment.
• May Wards Total Vehicle Sales: Cars are a big ticket item for consumers, so underlying vehicle sales trends can help shine a light on demand for durable goods.
Tuesday
• April Job Openings: A key measure of business demand for labor is the number of job openings, since reducing openings is easier and preferable to layoffs.
• April Factory and Durable Goods Orders: These metrics give insight into underlying trends for leading cyclical indicators.
• Earnings: Bath & Body Works (BBWI), Hewlett Packard Enterprise (HPE)
Wednesday
• May ADP Employment Report: This survey, released by ADP and usually released a day or two before the official government jobs report, offers insight into private sector employment trends.
• May ISM Services PMI: This index, released by the Institute for Supply Management, tracks how purchasing managers across different services industries feel about the business environment.
• Weekly Mortgage Applications: Mortgage activity gives insight on demand conditions in the housing market.
• Earnings: Brown-Forman (BFB), Campbell Soup (CPB), Dollar Tree (DLTR), Lululemon Athletica (LULU)
Thursday
• May Challenger Job Cuts: The firm Challenger, Gray & Christmas tracks the number of layoff announcements each month by sector.
• 1Q Productivity and Unit Labor Costs: These measures provide a breakdown of how productive workers were per hour of work and at what cost.
• April Trade Balance: Trade, made up of exports and imports, is an important driver of economic activity.
• Weekly Jobless Claims: This high frequency labor market data gives insight into filings for unemployment benefits. Jobless claims have continued to show a labor market that remains strong despite having cooled.
• Earnings: JM Smucker (SJM)
Friday
• May Employment Situation Summary: This monthly blockbuster release from the Labor Department gives a comprehensive look at employment, wages, and hours worked in the previous month.
• April Wholesale Inventories and Sales: Wholesalers often operate as an intermediary between manufacturers and retailers, serving as a key part of the goods supply chain.
• April Consumer Credit: Borrowing activity gives insight into broader economic activity.
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