Once a month, at 8:30 in the morning Eastern time, the Bureau of Labor Statistics publishes a report called The Employment Situation. Traders refresh their screens for it. Here’s what’s inside.
Two surveys, two numbers
The headline number, how many jobs the economy added, comes from a survey of businesses and government agencies. The unemployment rate comes from a separate survey of households.
Because they’re different surveys, they can tell slightly different stories in the same month. That’s normal.
Why markets care
The Federal Reserve watches the job market when it decides on interest rates. A very strong report can mean the Fed keeps rates high for longer, and a weak one can mean cuts are coming. Investors try to get ahead of that, which is why stocks and bonds can swing right after the release.
The fine print
The first number isn’t final. It gets revised in each of the next two reports as more data comes in, and sometimes the revisions are big. A month that looked great can look ordinary eight weeks later.
How to read it like a reporter
Look past the headline. Check the revisions and wage growth, and see which industries added or lost jobs. That’s usually where the real story is.
Sources: Bureau of Labor Statistics, The Employment Situation