Everyday Economics: Why this week’s labor data matters more than the headlines

This week’s economic calendar brings familiar names – the ISM Manufacturing and Services indices – but the real focus is the return of government labor market data after the shutdown-induced blackout. The November JOLTS report and the December jobs report will provide the first clean read on whether the labor market’s recent softening was a temporary pause or the start of a more durable slowdown.

Before the shutdown, the jobs market already was bending in a less reassuring direction. Since January 2025, nearly one million additional Americans have become unemployed, while total employment has declined by roughly 154,000. Those are not numbers consistent with a labor market that is merely “cooling.” They reflect a market that has moved past peak tightness and is now absorbing weaker demand, slower hiring, and a rising pace of layoffs.

Consensus expectations for the December jobs report reflect that reality. Payroll growth is expected to be slim, and the unemployment rate is forecast to edge up to 4.7% ...