WASHINGTON — After weeks of uncertainty caused by the 43-day federal government shutdown, the U.S. economy is set for a long-awaited reality check on Tuesday, December 16. A delayed jobs report will combine two consecutive months of payroll data, while retail sales figures—also thrown off schedule—are expected to offer a key read on consumer momentum heading into the end of the year. [1]
The timing matters. The Federal Reserve cut rates last week for the third time this year, pointing to softness in the labor market even as inflation remains an active concern. Investors and policymakers alike have been navigating a rare information gap—one that is now starting to close, but with notable caveats. [2]
Why today’s US jobs report is unusual—and why it may still leave big questions
The jobs report expected Tuesday is not a standard “first Friday of the month” release. Because the shutdown disrupted data collection and processing, the government delayed publication and is now delivering an unusual package:
- October 2025 will not have a full Employment Situation release.
- October household survey data (which produces the unemployment rate and key demographics) was not collected and will not be reconstructed.
- October establishment survey payroll data is expected to be published alongside November’s data. [3]
That missing October household survey is significant. It means there will be no official October unemployment rate, a gap that Reuters and the Washington Post describe as a historic first for the modern unemployment series that began in 1948. [4]
In other words: today’s release should deliver badly needed clarity on hiring and paychecks—but it may not fully answer how unemployment and labor-force participation shifted during the shutdown period.
The last official benchmark: September showed hiring, but also a higher unemployment rate
Before today’s combined update, the most recent official snapshot is still September 2025, which the Bureau of Labor Statistics published late (in November) due to the lapse in federal funding.
In that report, BLS said:
- Nonfarm payrolls rose by 119,000 in September, with gains concentrated in health care, food services and drinking places, and social assistance.
- The unemployment rate held at 4.4%.
- Average hourly earnings rose 0.2% month over month and 3.8% year over year. [5]
That combination—moderate hiring, higher joblessness relative to earlier in the year, and cooling wage growth—set the tone for what many economists now describe as a “softening” labor market rather than a collapse.
What economists expect for October and November payrolls
With the new report, economists are trying to separate signal from noise—particularly because the shutdown didn’t just delay data; it changed what could be collected.
November payrolls: a modest rebound, but still weak by recent standards
Forecasts vary by survey, but the broad expectation is for low job growth in November, ranging roughly from about 40,000 to 50,000 jobs added. [6]
Both Reuters and ABC News report expectations around 50,000 jobs added in November. [7]
AP’s preview points to about 40,000. [8]
The gap matters because recent hiring has already cooled meaningfully. AP notes that job creation has been sluggish in late 2025 and highlights revised figures suggesting the prior year produced fewer jobs than initially estimated. [9]
October payrolls: the “federal buyouts” factor
Economists generally expect October payrolls to look weaker than November, in part because of federal workforce changes. Reuters reports that about 150,000 federal employees accepted buyouts, which could weigh on October’s payroll count. [10]
The Washington Post similarly points to federal worker departures as a likely drag on October payrolls. [11]
Unemployment rate: the key number that will be partly missing
Here’s the complication: the October unemployment rate won’t be published because the underlying household survey data wasn’t collected during the shutdown. [12]
For November—where household survey data should be available—forecasts differ slightly:
- Reuters reports expectations for 4.4% unemployment in November. [13]
- ABC News reports economists expect a slight uptick (around 4.5%). [14]
Meanwhile, Reuters says economists estimate October unemployment may have jumped to roughly 4.6%–4.7%, but emphasizes this is an estimate, not an official number. [15]
Wages and hours: the Fed’s inflation-sensitive “labor cost” lens
While job gains make headlines, wage growth is often the detail the Federal Reserve watches most closely—because persistent wage pressure can keep services inflation elevated.
Reuters expects wage growth to continue cooling, with average hourly earnings rising around 3.6% year over year in November, down from 3.8% year over year in September. [16]
If that trend holds, it would strengthen the case that the labor market is easing without a sudden spike in layoffs—an outcome the Fed would typically prefer.
Retail sales: the consumer check-in also delayed by the shutdown
The other major storyline today is consumer spending.
Normally, retail sales arrive on a predictable monthly cadence. But the shutdown delayed government data releases across agencies—including the Census Bureau’s retail sales reporting.
Census has said the Advance Monthly Sales for Retail and Food Services (October 2025) release was rescheduled for December 16, 2025, and that subsequent releases were still being updated due to the funding lapse. [17]
However, as of the latest available Census retail sales report, the most recent published advance estimate is still September 2025:
- Retail and food services sales were $733.3 billion, up 0.2% from the prior month and up 4.3% year over year (not adjusted for price changes). [18]
- Nonstore retailers were up 6.0% year over year, while food services and drinking places were up 6.7% year over year. [19]
That September report also underscored a critical point: retail sales are not inflation-adjusted, meaning “real” (inflation-adjusted) spending can look softer than the headline suggests. [20]
What economists expect from October retail sales
Ahead of today’s release, many economists have been bracing for signs that the consumer—still the biggest engine of U.S. growth—is slowing.
Barron’s reports that economists broadly expect headline retail sales for October to rise around 0.1%, reflecting a moderation after September’s slower pace. The article also notes that weakness may be tied to softer auto sales and declines in categories like gasoline and home-related spending. [21]
Even a small increase could mask a more complicated picture:
- If prices rise faster than sales, real spending may effectively be flat or down.
- If spending shifts toward essentials, discretionary retailers may feel a sharper pinch even when total sales hold up.
The Fed backdrop: rate cuts are already happening, but the next move is uncertain
Today’s data arrives just days after the Fed cut interest rates by a quarter point, taking its benchmark rate to 3.5%–3.75%, according to ABC News. [22]
Fed Chair Jerome Powell has signaled caution about the path ahead, saying the central bank is “well-positioned to wait and see how the economy evolves,” even as it tries to balance employment and inflation risks. [23]
The jobs and retail reports are central to that balancing act:
- If payroll growth and wages come in stronger than expected, the Fed could feel pressure to slow or pause cuts, worried that demand remains too hot.
- If hiring is weak and retail sales cool sharply, the Fed could face a different risk: that the economy is losing altitude faster than expected.
Markets are bracing for volatility as the data gap narrows
The combination of a delayed jobs report, delayed retail sales, and ongoing uncertainty about future inflation readings has left markets jumpy.
Reuters reported U.S. stock index futures were slightly lower Tuesday morning as investors awaited the jobs report, noting that the shutdown created a data gap that forced markets to lean on mixed secondary indicators. [24]
And the calendar remains crowded: Reuters also highlighted that this week’s delayed data releases include major gaps in inflation reporting, with October CPI canceled and November CPI expected to include only partial October figures and altered reporting detail for some comparisons. [25]
What to watch once the numbers hit
When the reports are released, several details are likely to drive the narrative beyond the headline payroll number:
- Private-sector vs. government hiring
- Any visible hit from federal workforce reductions could distort the topline.
- Sector leadership
- Reuters expects job growth to remain concentrated in health care, social assistance, and hospitality—areas that have carried recent months. [26]
- Wage growth and the workweek
- Cooling earnings growth would reinforce the “soft landing” storyline; re-acceleration could reignite inflation concerns.
- Retail sales “control group” and discretionary categories
- Markets often focus on the components that feed into GDP and on whether discretionary spending is weakening heading into the holiday season.
Bottom line: a high-stakes data day, with an asterisk
December 16 is shaping up as one of the most important U.S. economic data days of the year—not because it delivers perfect clarity, but because it finally provides fresh official numbers after a shutdown-driven blackout.
Still, the missing October unemployment rate means the labor market story will remain incomplete, and the broader inflation picture will stay clouded until additional data arrives later this week. [27]
References
1. abcnews.go.com, 2. abcnews.go.com, 3. www.bls.gov, 4. www.reuters.com, 5. www.bls.gov, 6. www.reuters.com, 7. www.reuters.com, 8. apnews.com, 9. apnews.com, 10. www.reuters.com, 11. www.washingtonpost.com, 12. www.bls.gov, 13. www.reuters.com, 14. abcnews.go.com, 15. www.reuters.com, 16. www.reuters.com, 17. www.census.gov, 18. www.census.gov, 19. www.census.gov, 20. www.census.gov, 21. www.barrons.com, 22. abcnews.go.com, 23. abcnews.go.com, 24. www.reuters.com, 25. www.reuters.com, 26. www.reuters.com, 27. www.reuters.com
