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This number could tell us where America is heading

As investors desperately attempt to discern the pace of economic growth, Friday's employment report could shed some much-needed light on where America is heading.

Over the past week, some troubling signs about the US economy have emerged. On Friday, Q1 GDP growth was revised down to negative 1 percent. And Treasury yields continued to plunge, with the all-important 10-year yield slipping as low as 2.4 percent, the smallest yield since June 2013. Since yields tend to track growth and inflation expectations, this could be interpreted as a signal that investors have become more pessimistic.

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On the other hand, US yields have largely followed European yields lower. And the soft GDP print actually boosted some economists' expectations of what the next few quarters could bring, given that it could lead to a strong bounce-back in the second quarter and beyond.

Into this morass of confusion comes the May employment report. A strong surge in non-farm payrolls could indicate a spring rebound, and could set the path for above-trend economic growth. Alternately, a weak number may suggest that the weakness in the first quarter isn't as weather-related as the bulls would hope.

"This jobs report could be important, because we're kind of bifurcated," said global macro trader Mark Dow, who writes at the Behavioral Macro blog. "A lot of people are looking for an upside surprise, and some people think the economy's very weak. So many people are reading signals in to the bond market noise, and if we get a weak number, people will buy that much more into the fixed income story."

On the whole, economists expect to see nonfarm payrolls grow by 220,000, according to Reuters, which is about the average of the gains seen over the course of 2014.

Some positive vibes have already been sent out by the jobless claims data—on Thursday, the four-week average of claims dropped to the lowest level since 2007, which is a good sign for job growth.

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For those who are optimistic, like Deutsche Bank chief US economist Joe LaVorgna, employment data will start to clearly portray both a spring rebound and above-trend growth.

In fact, even if the actual reading comes in below 200,000, "I'm sure we'll get there after the revision," LaVorgna said. He points out that nonfarm payrolls have been revised up in 19 of the last 20 months, and by an average of 36,000.

"Employment is perpetually understated." Whatever the number comes in at, "just add about 40,000 to it," he told CNBC.com.

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From a trading standpoint, a strong number could add to the slow and steady (with an emphasis on slow) gains that stocks have enjoyed recently.

After the positive jobless claims reading, "I expect this number to confirm it," said Jim Iuorio of TJM Institutional Services. "And I think stocks are still going higher."

—By CNBC's Alex Rosenberg.

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