NEW YORK ( TheStreet) -- Friday's payroll numbers likely will confirm that the U.S. jobs market is stuck in a post-recession hangover. The general consensus from economists is that the labor market continues to struggle but isn't rolling over. Initial jobless claims have not seen a consistent trend downward and the most recent weekly reading actually snapped back above the 400,000 level. Hopes aren't high for the government's September jobs report to surprise to the upside. "If the report reinforces the view that the economy is still expanding, albeit modestly, we won't get a big reaction," said Josh Feinman, chief economist with Deutsche Asset Management. But "make no mistake -- the labor market is deeply depressed." The unemployment rate is expected to remain at 9.1% and the economy likely created 60,000 total new jobs, helped by a private sector increase of 100,000 new jobs in September, according to a Reuters survey. September may be a modest improvement from August when companies added just 17,000 new jobs in August, and zero jobs on a whole after factoring cuts in government workers. ADP estimates released Wednesday set an improved tone ahead of Friday's report. Economists were modestly relieved to see companies add 91,000 new jobs in September. "If ADP is right, employers are cutting back in a measured fashion and are not acting -- at least not yet -- as though they fear a new recession," wrote Ian Shepherdson, chief U.S. economist at High Frequency Economics, whose estimates for Friday's headlines come close to the Reuters consensus. However, a surge in jobs cuts in September to the highest level since April 2009, according to consulting firm Challenger, Gray & Christmas, have economists cautious ahead of Friday. Taking into account Challenger's assessment as well as seasonal adjustments, research firm Capital Economics estimates that nonfarm payrolls saw no change in September. The nonfarm payrolls number has a margin of error up or down 100,000 jobs, so there is room for surprise on Friday. "The market is likely to "continue to 'climb a wall of worry' into the employment report and the weekend ahead of the start of the earnings season," wrote Marc Pado, market strategist with Cantor Fitzgerald, in a research note. One of the most concerning trends, analysts said, is that Americans are increasingly giving up on finding jobs. According to David Ader, market strategist at CRT Capital Group, more people are leaving the labor force since 2008, which means that a decrease in the unemployment rate isn't necessarily good news. Recent jobs data tell a "cautionary tale," wrote Ader, adding that "stable or lower claims, while good on the surface, has a dark underside." According to Komal Sri-Kumar, global strategist with investment firm TCW, the "participating rate," or percentage of people with jobs who want one, have reached the lowest level since 1983. Sri-Kumar estimated that the U.S. economy needs to add 200,000 to 250,000 jobs month after month, along with economic growth of at least 2.5% annually, to push the current unemployment rate down. If the economy picks up, people who once gave up looking for jobs tend to resume their searches, meaning that the headline payroll number has to sustain levels above 200,000 for several months in a row to be meaningful, he explained.
Looking past the September data points, the long-term outlook for the jobs market looks painfully sluggish. Standard Chartered Bank said it anticipates that only 125,000 jobs will be added on average per month in 2012, and 150,000 on average per month for 2013 to 2015. Even under this scenario, the unemployment rate will range between 7.7% and 11.2%. The good news is that unless the headline number on Friday tanks, analysts aren't expecting much negative reaction from the market. Investors are more concerned about European headlines and stocks have been at their mercy of late. However, that also means a better-than-expected payroll number may not provide much of a boost either. "If the weak hints provided by Challenger and ISM non-manufacturing failed to hold the market, let alone give it a boost earlier in the week , then we think the nonfarm payroll doesn't matter so much in the shadow of what's going on in Europe," wrote Ader at CRT Capital Group. -- Written by Chao Deng in New York. >To contact the writer of this article, click here: Chao Deng. >To follow the writer on Twitter, go to: @chao_deng >To submit a news tip, send an email to: firstname.lastname@example.org.