The delayed January jobs report will be released Wednesday. Here's what to expect

• Economists forecast January payroll growth near zero to 55,000, down from December's modest gains, with unemployment expected to hold at 4.4%
• Benchmark revisions may eliminate 600,000-900,000 jobs from prior reports dating back to early 2024, with 2025 months already revised down by 624,000 total
• White House officials are preemptively lowering expectations, citing immigration policy impacts and AI-driven productivity gains that reduce hiring needs despite economic growth

January Jobs Report Preview: Weak Growth and Major Revisions Expected

Key Expectations:

The delayed January nonfarm payrolls report, releasing Wednesday at 8:30 a.m. ET, is forecast to show minimal job growth. The Dow Jones consensus estimates 55,000 new jobs, down from December's figures, with unemployment expected to hold at 4.4% and wage growth at 3.7%. However, several economists predict even weaker results—Goldman Sachs forecasts 45,000 jobs, while Moody's Analytics Chief Economist Mark Zandi suggests the number could be near zero.

Benchmark Revisions:

The Bureau of Labor Statistics will release final benchmark revisions covering the 12 months through March 2025, potentially erasing most gains from that period. Preliminary estimates suggested cuts of approximately half the originally reported job creation. Goldman Sachs expects revisions between 750,000-900,000 jobs downward, while Fed Chair Powell indicated approximately 600,000. Every 2025 monthly report has already been revised downward by a combined 624,000 jobs, leaving average monthly gains below 40,000.

Market Implications:

White House Economic Council Director Kevin Hassett preemptively lowered expectations, citing immigration enforcement and AI-driven productivity gains as factors suppressing hiring needs. He suggested job creation could lag even as GDP and productivity surge. Supporting data shows concerning trends: December job openings hit their lowest since September 2020, hiring announcements reached worst January levels since 2009, and ADP reported weak private sector growth.

Fed officials remain focused on longer-term employment trends rather than monthly volatility. Regional Fed Presidents Lorie Logan and Beth Hammack indicated greater concern about inflation than unemployment, suggesting extended rate-hold periods ahead.

The report's weakness could signal labor market fragility, with economists warning layoffs may accelerate soon, potentially leading to negative job growth.