Delayed January Jobs Report Set for Wednesday Release: Key Expectations

• Economists predict January nonfarm payrolls growth near zero (consensus: 55,000), with some forecasting as low as 45,000, while unemployment is expected to hold at 4.4%
• Annual benchmark revisions may eliminate 600,000-900,000 jobs from prior reports (March 2024-2025), with every 2025 month already revised down by a total of 624,000 jobs
• White House officials are preemptively lowering expectations, citing immigration policy impacts and AI-driven productivity gains that reduce hiring needs despite economic growth

Summary: January Jobs Report Preview

Key Expectations

The delayed January jobs report, set for release Wednesday at 8:30 a.m. ET, is expected to show minimal employment growth. The Dow Jones consensus forecasts 55,000 new nonfarm payrolls, down from December's figures, with unemployment holding at 4.4% and wage growth at 3.7%. However, several economists predict weaker results—Goldman Sachs expects 45,000 jobs, while Citigroup projects 135,000 with seasonal distortions masking near-zero underlying growth. Mark Zandi of Moody's Analytics suggests zero job growth is plausible.

Benchmark Revisions

The Bureau of Labor Statistics will release final benchmark revisions for payrolls covering 12 months prior to March 2025. Preliminary estimates suggested 500,000-900,000 fewer jobs than initially reported. Fed Chair Powell indicated revisions could reach 600,000. Every 2025 month has seen downward revisions totaling 624,000 jobs, reducing average monthly gains to under 40,000.

Market Implications

Labor market deterioration signals include December job openings falling to September 2020 lows, January hiring announcements hitting the worst level since 2009, and ADP reporting weak private sector job growth. However, small businesses showed stronger 3.3% hiring growth.

White House Director Kevin Hassett attributed weak numbers to immigration policies and AI-driven productivity gains, urging against panic. Fed officials Lorie Logan and Beth Hammack emphasized patience on rate cuts, prioritizing inflation concerns over employment weakness and suggesting rates could remain on hold "for quite some time."

The report's weakness, combined with significant downward revisions, raises questions about labor market health and future Fed policy direction.