Jobs report to offer economic snapshot weeks before Election Day

Investors and policymakers eagerly await a jobs report on Friday that will show whether the labor market has continued its monthslong cooldown. The fresh report marks one of the last major pieces of economic data before the presidential election.

Economists expect the new economic release to show that the U.S. economy added 150,000 jobs in September, which would amount to a slight uptick from the previous month.

Weaker-than-expected jobs data in both July and August has stoked concern among some economists about the nation's economic outlook.

Despite an overall slowdown this year, the job market has proven resilient. Hiring has continued at a solid pace; meanwhile, the unemployment rate has climbed but remains near a 50-year low.

"The labor market is still healthy, but we have clearly seen a slowdown," Roger Aliaga-Diaz, chief Americas economist at investment firm Vanguard, told ABC News in a statement. "Now we are approaching an inflection point."

The new data is set to arrive roughly two weeks after the Federal Reserve cut its benchmark interest rate a half of a percentage point. The landmark decision dialed back a years-long fight against inflation and offered relief for borrowers saddled with high costs.

Inflation has slowed dramatically from a peak of about 9% in 2022, though it remains slightly higher than the Fed's target of 2%.

Speaking at a press conference in Washington, D.C. last month, Fed Chair Jerome Powell described the rate decision as a shift in approach as the Fed focuses more on ensuring robust employment and less on lowering inflation.

"This recalibration of our policy stance will help maintain the strength of the economy and the labor market, and enable further progress on inflation," Powell said.

In theory, lower interest rates help stimulate the economy and boost employment. However, the Fed's interest rate decisions typically take several months before they influence economic activity. In any case, the soon-to-be released report tracks hiring for September, meaning the majority of the period reflected in the data took place before the rate cut.

Still, the jobs report holds significant implications for further rate decisions over the coming months. The Federal Open Market Committee, or FOMC, a policymaking body at the Fed, has forecast additional interest rate cuts.

By the end of 2024, interest rates will fall another half of a percentage point from their current level of between 4.75% and 5%, according to FOMC projections. Interest rates will drop another percentage point over the course of 2025, the projections further indicated.

The new jobs data will be released at a time when the economy faces a potentially significant disruption. Tens of thousands of dockworkers went on strike Tuesday, snarling dozens of ports along the East and Gulf coasts. The work stoppage threatens to reignite inflation and cause layoffs in related industries if the work stoppage persists, experts said.