The January jobs report is arriving at a critical time for the U.S. economy. Inflation is rising. The pandemic is still taking a toll. And the Federal Reserve is trying to decide how best to steer the economy through a swirl of competing threats.
Unfortunately, the data, which the Labor Department will release on Friday, is unlikely to provide a clear guide.
A slew of measurement issues and data quirks will make it hard to assess exactly how the latest coronavirus wave has affected workers and businesses, or to gauge the underlying health of the labor market.
“It’s going to be a mess,” said Skanda Amarnath, executive director of Employ America, a research group.
on Twitter and in conversations with reporters that a weak January jobs number would not necessarily be a sign of a sustained slowdown.
Economists generally agree. Coronavirus cases have already begun to fall in most of the country, and there is little evidence so far that the latest wave caused lasting economic damage. Layoffs have not spiked, as they did earlier in the pandemic, and employers continue to post job openings.
“You could have the possibility of a payroll number that looks really truly horrendous, but you’re pulling on a rubber band,” said Nick Bunker, director of economic research for the job site Indeed. “Things could bounce back really quickly.”
loss of purchasing power over time, meaning your dollar will not go as far tomorrow as it did today. It is typically expressed as the annual change in prices for everyday goods and services such as food, furniture, apparel, transportation and toys.