August Jobs Report: What to Look For

A robust report would complicate plans for a more rapid easing, said Kathy Bostjancic, chief United States financial economist at Oxford Economics. A half-point cut would fade out of view.

But even with a healthy number, a quarter-point reduction seems certain, Ms. Bostjancic said. The Fed has already signaled its openness to easing monetary policy in light of rising risks, and one monthly jobs report, good or bad, isn’t likely to be enough to change the central bank’s course.

“After September, we expect additional rate cuts in October and December as the downside risks are increasing,” she added, citing the impact of tariffs, slowing global growth and the weakness in American manufacturing.

In part, she said, the rate cuts are intended to compensate for the anticipated drag from the tariffs in 2020. She estimates tariffs will reduce economic growth by more than a half a percentage point next year.

Reasons for Hope?

Not everyone on Wall Street is feeling gloomy. Michael Arone, chief investment strategist at State Street Global Advisors, is expecting a gain of 165,000 jobs.

The reason? He said there’s little evidence that the chill that’s overtaken some larger businesses is affecting consumers, whom he characterized as “the workhorse of the American economy.”

In July, retail sales rose by 0.7 percent, after a 0.3 percent increase in June.

“The underlying economy is stronger than many people anticipate,” Mr. Arone said. “The U.S. consumer continues to be in good shape, and this report will reflect that.”

Small businesses, too, remain optimistic, he said, citing a recent survey by the National Federation of Independent Business. “They’re in good shape,” Mr. Arone said.