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 A Reuters survey estimated that nonfarm payrolls rose 230,000 last
month after May's 280,000 jump, the largest gain since December.
Even with a slowdown from the prior month, June's increase would be
well above the average for the first five months of the year and
more than sufficient to keep up with population growth.
"What matters is the trend. We are making a lot of progress in
reducing slack and unless the labor market weakens sharply, the Fed
is on track to raise interest rates in September," said Ryan Sweet,
a senior economist at Moody's Analytics in West Chester
Pennsylvania.
The jobless rate is forecast to fall one-tenth of a percentage point
back to a seven-year low of 5.4 percent, not far from the 5.0
percent to 5.2 percent range most Fed officials consider consistent
with full employment.
The Labor Department's closely watched report, normally issued on a
Friday, will be released on Thursday at 8:30 a.m. (1230 GMT) because
of the Independence Day holiday.
Should the data meet expectations, it will be the latest indication
the economy has rebounded from a first-quarter slump with a solid
pace of growth during the April-June quarter.
From consumer spending to housing and consumer confidence, economic
reports have had a decisively strong tone since May, prompting many
forecasters to raise their second-quarter growth estimates to above
a 3 percent annual pace. The economy contracted at a 0.2 percent
rate in the first quarter.
MODERATE PRESSURE ON WAGES
"The accelerating economy looks like it is picking up even more
steam. All components of the economy are now moving forward," said
Joel Naroff, chief economist at Naroff Economic Advisors in Holland,
Pennsylvania.
The tightening labor market is expected to exert moderate upward
pressure on wages. Average hourly earnings are expected to rise 0.2
percent in June after increasing 0.3 percent in May. That would
bring down the year-on-year increase to a tepid 2.2 percent, but
anecdotal evidence and other measures of wage growth suggest
paychecks are getting fatter.
State and local governments have raised the minimum wage and surveys
show entry-level wages for new college graduates are rising. In
addition, Walmart, the nation's largest private employer, has
announced wage increases twice this year.
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Economists expect little change in several other labor market
measures Fed officials are eyeing as they contemplate raising rates
for the first time since 2006.
Many of those gauges have shown the jobs market gaining strength.
The labor force participation rate, or the share of working-age
Americans who are employed or at least looking for a
job, increased to a four-month high in May as more people, including
new college graduates, entered the market.
The number of discouraged workers in May was the lowest since
October 2008, and the percentage of the working-age population
employed reached the highest level in nearly six years.
Payroll gains in June are expected to be broad-based, with further
gains in manufacturing and construction.
The mining sector, however, likely lost more jobs because of layoffs
in the energy industry.
Oil-field companies, including Schlumberger, Baker Hughes and
Halliburton, have announced thousands of job cuts after a more than
60 percent plunge in crude oil prices last year.
(Reporting by Lucia Mutikani; Editing by Steve Orlofsky)
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