What to Expect From the September Jobs Report

Patricia Cohen
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At 8:30 a.m. Eastern, the Labor Department will report its latest figures on hiring and unemployment for September.

After employers added a disappointing 173,000 new jobs last month, analysts are hoping that gains will at least top the 200,000 mark as the economy heads into the final quarter of 2015. The jobless rate is expected to hold at 5.1 percent

This is what you should watch for:

A "Now Hiring" sign is shown at an exhibitor’s table at the Columbus Career Fair in Columbus, Ohio.
Ty Wright | Bloomberg | Getty Images

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■ Significant wage gains have remained hard to come by.

The best evidence of a tightening labor market is rising wages, but despite the steadily falling unemployment rate in recent months, significant wage gains over time have been hard to come by.

The 0.3 percentage point increase in average hourly wages in August was a welcome bright spot given the anemic growth in jobs. That showing pushed average hourly wages up 2.3 percent from a year ago.

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Maintaining that upward momentum would make the Federal Reserve, which is considering when to raise its benchmark interest rate, as well as American workers feel a lot better about the economy's direction.

■ Despite the previous month's sluggishness in hiring, there could be bright spots.

Hiring has been particularly strong, said Andrew Chamberlain, chief economist at Glassdoor Economic Research, in industries like professional and business services, health care, and travel and leisure (where automation cannot take the place of servers and maids).

The need to collect, manage and report information, along with the expansion of mobile apps in health care and other sectors, is also fueling job growth in the technology sector.

■ Chances are also good the previous month's figures will be revised up.

Because of unpredictable seasonal variations, the Labor Department has historically tended to lowball the initial employment estimates for August only to revise them up later on.

Over the last five years, the revisions have on average added another 77,000 jobs, according to High Frequency Economics. That pattern also holds true for the September figures, although the revised increases have tended to be much smaller.

■ Jobs in the private sector do not necessarily translate to public sector hiring.

After a pickup in public sector jobs in August, several labor economists are continuing to look for additional increases in September.

There are roughly 381,000 fewer public sector jobs now than there were before the start of the recession in 2007, said Elise Gould, an economist at the Economic Policy Institute, a labor-oriented research organization in Washington. Add in the normal growth that would be needed to keep pace with an expanding population, Ms. Gould said, and there is a public sector jobs gap of 1.7 million.

The generally sluggish recovery in the public sector — the result of continuing austerity in many cities and states throughout the country —has particularly hurt blacks, who occupy a disproportionate share of those jobs.