The start of a new month means only one thing for Wall Street — it’s time for the all-important monthly jobs report.
On Friday, the U.S. Labor Department will release employment data for May.
For investors, the numbers will matter not so much for what they say about the health of the economy, but what they portend for the future of the Federal Reserve’s easy-money policies, which have contributed greatly to the strength of the stock market this year.
Fed Chairman Ben Bernanke said many times that his agency will start tapering off its $85 billion in monthly bond purchases only if there is consistent improvement in the labor market.
Jobs growth in the first half of 2013 has been solid thus far, with the unemployment rate having fallen each month to its current four-year low of 7.5%, though that is due in large part to a declining labor force participation rate.
For May, economists are expecting nonfarm payrolls to increase 165,000, which would be match Aprils 165,000 gain.
“Historically, the pace of payroll growth has slowed in the spring and summer months. However, with the relative consistency in the payrolls numbers and the lack of exaggerated gains in the first few months of the year, it is likely that job growth will remain consistent in the coming months,” said Wells Fargo in a report