A ‘now hiring’ sign is displayed in a business’s window in Manhattan on Jan. 9, 2026, in New York City.
Spencer Platt | Getty Images
The jobs report Wednesday will give markets a lot to consider, as investors parse through fresh data and a batch of revisions.
Economists expect that January’s nonfarm payrolls report will show growth that was nil or not much better during the month. On top of that, annual revisions also could reveal that the U.S. economy going back to early 2024 had generated few if any net jobs, casting further doubt on the health of the labor market.
“I think zero would be the forecast,” said Mark Zandi, chief economist at Moody’s Analytics. “The consensus is probably around 50,000. Anything around zero just shows you how fragile things are, just very weak. This is all happening with no layoffs, but layoffs are going to pick up. I think we could get job losses here pretty soon.”
The payrolls report will be released at 8:30 a.m. ET. It was delayed five days due to the brief government shutdown.
Officially, the Dow Jones consensus forecast is calling for payroll gains of 55,000, a number that has been trending lower and would come after a December increase of 50,000. That is expected to be good enough to keep the unemployment rate at a still-low 4.4%, with annual wage gains of 3.7%.
However, a number of Wall Street economists are predicting a below-forecast number. Goldman Sachs, for instance, expects an increase of just 45,000. On the other side, Citigroup is projecting a gain of 135,000, but one that it attributes to seasonal distortions, with “appropriately adjusted payroll growth … closer to zero.”
Wiping out previous gains
Then there are the revisions, a nettlesome problem for the Bureau of Labor Statistics as it struggles to get timely and relevant data.
Last September, the BLS estimated in its preliminary adjustment that benchmark revisions for the year prior to March 2025 would show 911,000 fewer jobs than previously reported, or about half the total. The bureau will report the final number Wednesday, with expectations that the final count will be less than that but still significant. Goldman, for instance, estimated the number to be between 750,000-900,000, while Fed Chair Jerome Powell said a few weeks ago that it could be closer to 600,000.
Every month of 2025 reported so far has seen downward revisions, taking initially reported estimates down by 624,000 and leaving average monthly payroll gains of less than 40,000. Wednesday’s report will feature the first revision for December’s count.
The BLS also is adjusting the model it uses to estimate jobs created by businesses opening and closing during the month, which also could play with the numbers.
In any event, the revisions will show a stumbling labor market that likely will get further attention from Powell and his colleagues as they plot their next policy move.
Lowering expectations
Even White House officials have been spending time this week trying to tamp down expectations.
Kevin Hassett, the National Economic Council director who was a finalist to become the next Federal Reserve chair, told CNBC that several factors are converging to keep payroll growth low, at least for the time being.
Primary among them is the administration’s efforts to tackle illegal immigration. Hassett also cited rising productivity stemming from artificial intelligence improvements that is restraining businesses’ need to hire.
“I think that you should expect slightly smaller job numbers that are consistent with high GDP growth right now. … One shouldn’t panic if you see a sequence of numbers that are lower than you’re used to,” he said Monday. “Because, again, population growth is going down and productivity growth is skyrocketing. It’s an unusual set of circumstances.”
Hassett added that there could be a scenario where “job creation lags, productivity skyrockets, profits skyrocket, GDP skyrockets.”
There have been other signs of labor market deterioration lately.
Job openings plunged in December to their lowest level since September 2020, according to the BLS. At the same time, planned layoffs and hires both had their worst January since the global financial crisis in 2009, Challenger, Gray & Christmas reported. Also, ADP reported private hiring of just 22,000 in January. On the bright side, Homebase reported that small businesses added jobs at a 3.3% rate last month, better than the 3.1% level in January 2025 and well above the 1.3% for the same month in 2024.
From the Fed’s perspective, policymakers look at employment trends over a period and not a month at a time. Most officials are expecting slowing hiring coupled with a low level of layoffs that, rather than suggesting a material weakening, point more to stabilization.
In speeches Tuesday, regional Presidents Lorie Logan of Dallas and Beth Hammack of Cleveland both said they think the economy is progressing well but are more worried about inflation than unemployment. They also cast doubt on the need for further interest rate cuts.
“Rather than trying to fine-tune the funds rate, I’d prefer to err on the side of patience as we assess the impact of recent rate reductions and monitor how the economy performs,” Hammack said. “Based on my forecast, we could be on hold for quite some time.”
