The September jobs report is expected to serve as the latest piece of evidence that the labor market has cooled off in 2024 but isn’t rapidly weakening at a pace that would prompt a larger interest rate cut from the Federal Reserve in November.

The monthly report from the Bureau of Labor Statistics, slated for release at 8:30 a.m. ET on Friday, is expected to show nonfarm payrolls rose by 150,000 in September while the unemployment rate held flat at 4.2%, according to consensus estimates compiled by Bloomberg.

In August, the US economy added 142,000 jobs and the unemployment rate declined to 4.2% after unexpectedly rising to 4.3% in July.

Here are the key numbers Wall Street will be looking at on Friday morning compared to the previous month, according to data from Bloomberg:

• Nonfarm payrolls: +150,000 vs. +142,000 previously

• Unemployment rate: 4.2% vs. 4.2% previously

• Average hourly earnings, month over month: +0.3% vs. +0.4% previously

• Average hourly earnings, year over year: +3.8% vs. +3.8% previously

• Average weekly hours worked: 34.3 vs. 34.3 previously

The key question entering Friday’s report is whether the data will reflect significant cooling in the labor market, which could prompt another large Fed interest rate cut.

“We expect growth in nonfarm employment will be stronger in September than August, but also think unemployment will edge higher,” Oxford Economics lead economist Nancy Vanden Houten wrote in a note to clients ahead of the release. “If the report on balance is much weaker than expected, it could be enough to prompt the Federal Reserve to lower rates by another 50bps at its November meeting.”

So far, investors mostly don’t think this will be the case. As of Thursday, markets were pricing in a roughly 36% chance the Fed cuts interest rates by half a percentage point in November, per the CME FedWatch Tool.

Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards

“We expect the September jobs report will reaffirm the status quo of a gently softening labor market characterized by slower demand absorption rather than broad-based layoffs,” EY senior economist Lydia Boussour wrote in a note ahead of the release. “The overall pace of job creation likely moved sideways in September with nonfarm payrolls expected to rise around 145,000 following a 142,000 advance in August.”

Other recent labor market data has reflected a job environment where fewer workers are changing jobs but companies aren’t executing mass layoffs. On Thursday, data from the Department of Labor showed 225,000 Americans filed for unemployment benefits in the week ending Sept. 28, near the lowest level seen in the past four months.

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Earlier this week, data from ADP showed the private sector added 143,000 jobs in September, above economists’ estimates for 125,000 and significantly higher than the 99,000 seen in August. This marked the end of a five-month decline in private-sector job additions.

“This is a pretty healthy, widespread rebound,” Richardson said. “And probably unexpected by many people who thought the job market was on a downward slide. This month, of course, gives pause to those kinds of assessments. Hiring is still solid.”

However, there are some signs of weakness emerging. New data from the Bureau of Labor Statistics released Tuesday showed that the quits rate, a sign of confidence among workers, ticked down to 1.9% in August from July’s 2%, marking the slowest pace since June 2020. Meanwhile, the Job Openings and Labor Turnover Survey (JOLTS) showed the hiring rate hit 3.3% in August, down from 3.4% in July. Excluding the pandemic, the hiring rate was at its lowest level since 2013 in August.

“The slowdown in turnover is to be expected after years of feverish churn, but as analysts search for nascent signs of stabilization in softening labor demand, the continued decline in the hiring and quits rates is not a good sign,” Wells Fargo senior economist Sarah House wrote in a note to clients on Tuesday.

House added, “Any unexpected weakness in this Friday’s report could push officials to deliver another outsized rate cut.”

Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.

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