US President Barack Obama and Mitt Romney are criss-crossing the US as the election campaign races towards its conclusion.
The two men are awaiting the final jobs report to be released before polling day, due to be made public later on Friday, at around 1230GMT.
The report from the Bureau of Labor Statistics is likely to show a slight rise in the unemployment rate in October, despite employers increasing hiring.
Employers are thought to have added about 125,000 jobs to their payrolls last month, according to a Reuters survey of economists. That would be up from 114,000 jobs created in September, but would still fall short of what is needed to quickly cut the jobless rate.
The report will be released at 1230GMT on Friday, and will be the last major report card on the economy before Tuesday’s presidential election.
Economists expect the unemployment rate – a key focus in the neck-and-neck race for the White House – to tick up by a tenth of a percentage point to 7.9 per cent, and is being seen as a correction to an underestimation of September’s September’s unexpectedly sharp 0.3 percentage point fall to 7.8 per cent.
That figure that was not entirely justified by the low number of net jobs generated that month, 114,000, or the 12.1 million people counted as officially unemployed.
The monthly report is one of the most closely watched indicators of the US economy’s health and regularly sets the tone for financial markets worldwide. Trading in global markets were sluggish on Friday morning in anticipation of the announcement.
Lacklustre job growth
If the economists polled are correct, it will show the eighth straight month of job growth, albeit at a lacklustre rate – a trend that will likely reinforce the Federal Reserve’s resolve to keep easy money policies in place until the economy shows more vigour.
“The weakness in overall economic growth momentum has extended into the last quarter of the year,” said Millan Mulraine, an economist at TD Securities in New York.
Romney has made the sluggishness of growth in the jobs market the centrepiece of his campaign. The latest Reuters/Ipsos daily tracking poll showed Obama and Romney in a dead heat.
Still, the report could provide fuel for both candidates. Some economists have noted an increase in the jobless rate might have a silver lining if it is driven by Americans pouring into the labour market to restart job hunts.
Yet barring a sharp acceleration in hiring, the report will reinforce the idea that a full recovery from the 2007-09 recession remains distant. The jobless rate, which peaked during the recession at ten per cent, remains about three percentage points above its pre-recession level.
Whatever the outcome of the jobs report, the political impact of the report will likely be muted, as most voters’ perceptions on the economy appear by now to be firmly fixed.
Ryan Grim, the Washington bureau chief for The Huffington Post, told Al Jazeera that the jobs report will make little difference at this late stage in the election.
“It depends on the report, but there are very few undecided voters left. I’d actually like to meet the person who’s waiting on this jobs report to make up his or her mind,” he said.
Last month’s jobs report evoked a firestorm of criticism from Romney supporters, including a comment by former General Electric chief executive Jack Welch that the numbers were “unbelievable” and Obama’s “Chicago guys will do anything”.
Grim said the charge from Welch was “completely nuts”, adding that he guesses “the unemployment number will tick up slightly”.
Even with a moderate pace of job creation, the US economy faces a real threat of a renewed recession next year.
Without action by politicians, existing legislation will raise taxes and cut spending to the tune of about $600bn in 2013. That scenario – known in Washington as the “fiscal cliff” – could easily cause the economy to contract. Fears of this possibility may have led businesses to hold back on hiring more workers in the past month.
“The uncertainty around the fiscal cliff has caused companies to just pause,” said John Canally, an economist at LPL Financial in Boston.
Europe’s debt crisis, which has had an impact on factory floors around the world, including those in the United States, is also weighing on the US economic recovery.
US manufacturers are thought to have shed 4,000 jobs in October, which would be the third straight monthly decline.
With the overall pace of job growth still subdued, average hourly earnings are expected to rise a tepid 0.2 per cent. The average workweek is seen holding steady at 34.5 hours.
October’s projected payroll additions, if sustained, might be just enough to slowly bring down the unemployment rate.
However, the Federal Reserve is expected to expand a new bond-buying programme at the end of the year to compensate for the end of another stimulus programme aimed at driving down borrowing costs.
Persistently weak labour market conditions led the central bank in September to launch a programme to buy $40bn worth of mortgage-backed securities every month until there is a sustained pick up in the labour market.
“The Fed is probably not impressed with the improvement in the job market over the past couple of months,” said Ryan Sweet, an economist at Moody’s Analytics in West Chester, Pennsylvania.
— Additional reporting by Ayse Alibeyoglu in Washington