Jobs day is here. At 8:30 a.m., the Labor Department will issue its report on hiring and unemployment in January.
The report will almost certainly show that American employers added jobs in January for the 88th consecutive month, by far the longest such streak on record. Wall Street economists surveyed by Bloomberg estimate that the economy gained about 180,000 jobs, which would represent a slight increase from December’s gain of 148,000 jobs. (That figure will be revised on Friday.)
This is what you should watch for:
With job growth expected to continue its recent steady course, most economists will instead be focusing on whether Friday’s report shows any sign of acceleration in wage growth. Economists expect an uptick in wages, 2.6 percent higher from a year earlier, but not a major acceleration.
The slow pace of wage growth has been a persistent economic mystery. The unemployment rate has dropped to 4.1 percent, the lowest level since 2000, and many economists think it could fall as low as 3.5 percent by the end of the year. Historically, a joblessness rate that low has been associated with much faster wage growth, as companies compete to attract scarce workers.
“We would’ve expected, honestly, wages to have gone up more, but wages have stagnated,” said Becky Frankiewicz, president of ManpowerGroup, a staffing firm.
There are signs that employers could at last be loosening their purse strings. A separate report from the Bureau of Labor Statistics this week found that private-sector wages and salaries rose 2.8 percent in the last three months of 2017, compared with a year earlier, the fastest growth since the recession. But other measures have found that pay growth is slowing.
One factor that could enhance January’s pay gains: minimum-wage increases that took effect in many parts of the country on Jan. 1. Diane Swonk, chief economist for the investment firm Grant Thornton, estimated that the minimum-wage increases could have a measurable impact on overall earnings, especially in the leisure and hospitality sector, which has many low-wage workers.
Employers added 2.1 million jobs in 2017, the weakest pace of growth since 2010. The gradual slowdown in hiring is not a concern — most economists expect growth to continue to ebb as the recovery goes on and the pool of available workers shrinks.
As the number of job seekers falls, employers are being forced to work harder to find workers. They are becoming more willing to consider candidates with criminal records, for example, or to waive educational requirements. The car retailer AutoNation this week said it was no longer refusing to hire workers who tested positive for marijuana use — a sign of changing legal and societal standards around the drug, but also an indication that companies are rethinking hiring practices in the face of a tight labor market.
“People who are marginally employable suddenly become highly employable in a period like this,” said Joseph Brusuelas, chief economist of RSM, a financial consulting firm.
The strong labor market is pulling workers off the economy’s sidelines. The labor-force participation rate — the share of adults either working or actively looking for work — has edged up recently. Ms. Swonk said she expected to see companies start trying to draw people into the labor force by letting them work from home or offering flexible schedules.
In his State of the Union address Tuesday night, President Trump boasted of the strength of the American economy, citing a rebound in the manufacturing sector and a decline in the unemployment rate for African-Americans, which recently hit its lowest level on record.
Most economists contend that Mr. Trump deserves relatively little credit for the strong economy, which predates his election and is partly a result of a global rebound outside his control. But it is true that recent job growth has been concentrated in blue-collar sectors that Mr. Trump has often emphasized. And it is likewise true that the improving labor market is increasingly reaching groups, including African-Americans, that are often at a disadvantage.
Mr. Trump and other Republicans argue that the economy will also benefit from the recently passed tax law. They point to recent announcements from Walmart and other companies, which have cited tax savings in their decisions to raise wages and pay bonuses to workers. Many economists are skeptical of such claims, regarding them as timely public relations moves. But they say the tax cuts should provide at least a modest addition to economic growth in coming years — although probably not enough to let the law pay for itself, as its backers have promised.
“I hear my clients saying the tax bill gave them more confidence in the pro-business economy,” said Tom Gimbel, chief executive of LaSalle Network, a staffing firm. “There’s confidence coming from D.C. that they’re not going to get in the way.”