Nonfarm payrolls forecast increasing 200,000 in November
Unemployment rate seen unchanged at 3.7
Average hourly earnings forecast gaining 0.3; up 4.6 yy

WASHINGTON, Dec 2 Reuters U.S. job growth was likely the smallest in nearly two years in November as mounting worries of a recession cooled demand for labor, which could give the Federal Reserve confidence to start slowing the pace of its interest rate hikes this month.

The Labor Department39;s closely watched employment report on Friday, which is also expected to show a continued moderation in wage gains last month, would follow on the heels of news on Thursday of a slowdown in inflation in October.

But the labor market remains tight, with 1.7 job openings for every unemployed person in October, keeping the Fed on its monetary tightening path at least through the first half of 2023. Labor market strength is also one of the reasons economists believe an anticipated recession next year would be short and shallow.

It39;s kind of like it39;s good news but not great news. The labor market is still very strong and still very tight, said Agron Nicaj, U.S. economist at MUFG in New York. The Fed might slow down the pace of rate hikes, but they are not at a point where they are going to completely stop.

The survey of business establishments is likely to show that nonfarm payrolls increased by 200,000 jobs last month, according to a Reuters poll of economists, the smallest number since December 2020, after rising by…