Could September Non-Farm Payrolls Be Negative for Auto Industry?
August 2017 non-farm payrolls were negative for auto industry
US non-farm payrolls (or NFP) show the number of jobs added or lost each month in the country. The employment summary for August 2017 was released by the US Bureau of Labor Statistics on September 1. The non-farm payroll change figure for August stood at 156,000, much lower than the market’s expectation of 180,000.
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On the day of the August data release, July’s NFP change of 209,000 was revised downward to 189,000, which led to pessimism.
Non-seasonally adjusted data
On a non-seasonally adjusted basis, August 2017 non-farm payroll data stood at 146,541, higher than the 146,330 in the previous month. In August, the healthcare, manufacturing, and mining sectors were among the top sectors where employment saw positive growth. There weren’t any major changes in the employment data from other sectors such as financial activities and transportation.
September estimates suggest continued weakness
Analysts expect the NFP change for September to drop about 130,000 from 180,000 in August. Among all of the other key macroeconomic indicators for the auto sector, non-farm payroll data act as one of the key indicators. Healthy employment growth in the country along with rising wages could boost the purchasing power of consumers. In general, higher purchasing power encourages people to buy expensive consumer goods such as vehicles. In August, the US job market showed signs of weakness. Overall, a continued downtrend in NFP data could be negative for future US auto demand.
Next, we’ll take a look at the most recent consumer sentiment data and what it suggests for the auto industry.