The most anticipated economic data release in months is arriving today, carrying significant implications for whether millions of American workers will see their wages keep pace with the rising cost of living in 2026.
Tuesday's economic calendar features a rare double release of employment data covering both October and November, alongside Retail Sales, Building Permits, and Manufacturing and Services PMI readings, according to Investing.com. The reports were delayed due to the government shutdown that ended in mid-November, leaving markets and policymakers operating with limited visibility into labour market conditions.
For workers hoping that their next salary review will bring some relief, this data could prove decisive.
What the Numbers Mean for Your Pay Packet
The Unemployment Rate is expected to remain steady at 4.4%, matching September's figure, which was the highest since October 2021. Average Hourly Earnings, often considered the most direct indicator of wage health, showed a monthly increase of 0.2% in the last reading, with year-over-year growth standing at 3.8%.
These figures matter because they influence whether workers' purchasing power improves or declines. If wage growth fails to outpace inflation — which the Federal Reserve described as 'somewhat elevated' in its December statement — real earnings gains will remain modest.
The previous Nonfarm Payrolls report showed an increase of 119,000 jobs for September, with private sector employment accounting for 97,000 of those gains. Today's data will reveal whether October's figures, which are expected to reflect a possible decline in federal government employment, signal broader weakness in the labour market.
The Participation Rate previously stood at 62.4%, while the U6 Unemployment Rate — a broader measure including discouraged and underemployed workers — reached 8.0%.
The Fed's Message to Workers
The Federal Reserve cut its benchmark interest rate by a quarter of a percentage point on 10 December, bringing it to a range of 3.5% to 3.75%. The decision was passed with a divided 9-3 vote, with Governor Stephen Miran favouring a larger half-point cut, while Chicago Fed President Austan Goolsbee and Kansas City Fed President Jeffrey Schmid voted to hold rates steady.
The central bank's statement acknowledged that 'job gains have slowed this year, and the unemployment rate has edged up through September,' while also noting that 'downside risks to employment rose in recent months.'
However, Chair Jerome Powell indicated that further rate cuts would be harder to justify. 'We are well-positioned to wait and see how the economy evolves,' Powell said following the meeting. The Fed's updated projections suggest just one additional cut in 2026 and another in 2027.
For workers, this matters because interest rate decisions influence hiring and wage competition among employers. A prolonged pause in rate cuts could dampen the labour market's ability to deliver meaningful pay increases.
Inflation Complicates the Picture
Powell also acknowledged that inflation pressures remain stubborn, attributing much of the overshoot to tariff-related price increases. 'If you get away from tariffs, inflation is in the low twos,' Powell explained. 'So it's really tariffs that's causing most of the inflation overshoot.'
This creates a tricky balancing act. Workers need stronger wage growth to maintain their purchasing power, yet if wages rise too quickly, it can fuel further inflation — prompting the Fed to keep rates higher and slow hiring.
Other Indicators to Watch Today
In addition to employment figures, today's releases include Retail Sales, forecast at 0.2% growth, which measures consumer spending patterns that account for the majority of US economic activity. Core Retail Sales, excluding automobiles, are expected at 0.3%.
Building Permits, a forward-looking indicator of the housing market, are forecast at 1.340 million. The Manufacturing PMI, which was at 52.2 last month, and the Services PMI at 54.1, will also provide clues about whether businesses expect expansion or contraction ahead. Readings above 50 indicate growth.
For workers wondering whether their next pay rise will stretch further at the supermarket or petrol station, the answers begin arriving at 8:30am ET.
