Friday’s jobs report would be better if Verizon workers were not on strike.
Economists forecast that nonfarm payrolls grew by 160,000 in May, unchanged from the prior month, according to Bloomberg.
But they think the job gains could have been higher.
But the dent to the jobs report has already happened. The strike was on during the reference period for the establishment survey, which usually includes the 12th day of the month.
Here’s Barclays’ Jesse Hurwitz, writing in a recent client note (emphasis ours):
Hurwitz noted that even though there were 35,100 workers on strike, there may not be a one-to-one net effect on the headline payrolls gain. That’s because when Verizon workers went on strike in August 2011, much of the drop in telecomms payrolls was offset by a rise in the temporary workers the company hired.
Previous episodes like this show that the Verizon strike could also affect average hourly earnings and hours worked, Deutsche Bank’s Joseph LaVorgna said in a recent note. That didn’t cause them to change their forecasts for either.