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22V Surveys: Investors More Confident in the Labor Market; Focus is on AHE Friday

Published on February 5, 2025

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By

Dennis DeBusschere

Brian Herlihy

Kevin Brocks

Sophia Wang

Quick summary:

  • Payrolls estimates skew slightly higher than sell-side estimates
  • AHE is the most watched indicator, supplanting Payrolls
  • Labor market confidence has risen this month with forecasts for softening pushed way back
  • Investors expect…
    • Payrolls 180k (BBG consensus 170k)
    • AHE in-line at 0.3%
    • Urate in-line at 4.1%

PAYROLLS: 40% of the investors we polled are watching Payrolls closer than normal. Only 20% less than normal.

Only 24% of our survey respondents think Friday’s data will be risk-on. 30% risk-off, and 46% mixed/negligible.

Even with hotter employment data this year, investor expectations for the market reaction are similar to the last two months.

Investors have turned their focus to Average Hourly Earnings this month after being far more focused on payrolls and the urate last month.

Investors still anticipate Payrolls won’t drop below 100k until 6 months+ out. Relative to last month, many investors have pushed their forecasts further back.

DATA ESTIMATES: Our survey consensus for Payrolls is higher than Bloomberg’s at 182k (BBG 170k). However, investor expectations are distributed across a broad range, slightly skewing higher.

Survey consensus for AHE is in-line at 0.3%. Investors are focusing on this release the most and the majority are not anticipating a surprise.

And survey consensus for the urate is also in-line, at 4.1%, but slightly skews lower.

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