Jobs Report (NFP)

The Non-Farm Payrolls (NFP) report is released on the first Friday of each month. It shows how many jobs were added or lost, the unemployment rate, and wage growth. This data heavily influences Fed policy and can cause instant market moves.

The Jobs Report measures employment changes across the US economy (excluding farms). It's the most important economic indicator because jobs drive consumer spending, which drives 70% of US GDP. A strong labor market typically means a strong economy.

The Fed watches employment closely when setting policy. Too many jobs = inflation risk = higher rates = stocks down. Too few jobs = recession risk = lower rates = stocks up (usually). It's counterintuitive—sometimes bad jobs news is good for stocks.

Whether strong jobs data is 'good' depends on the economic context. In 2022-2023 with high inflation, strong jobs = bad (more Fed hikes). In a recession, strong jobs = good (economy recovering). Always consider what the Fed will think.