Forecast: 133,000 new jobs, 4.2% unemployment

Americans say jobs are harder to find and businesses say they are scaling back plans to hire because of the trade wars. The April jobs report might offer the first hard evidence on whether President Donald Trump's tariffs are harming the U.S. labor market.

Here's what to watch for when the report is published Friday morning.

Did hiring slow?

The April jobs report was completed a little more than a week after Trump announced tariffs on most countries, but the writing was on the wall well before then.

Economists predict that the number of new jobs slowed to 133,000 from 228,000 in March - in no small part because of the trade wars. Surveys of business leaders show they were planning to reduce or freeze hiring until they could get a better handle on how the tariffs would pan out.

Some hints of a hiring halt have emerged in other reports, such as ADP's monthly survey of private-sector employment. The April jobs report will give the first clear indication of whether it's really happening and to what extent.

Unemployment rate

Don't expect to see much impact from the trade wars on the unemployment rate. It's still extremely low by historical standards at 4.2%, and Wall Street expects it to hold steady.

A big slowdown in hiring in April wouldn't necessarily push up the unemployment rate, either. Companies might be hiring fewer people, but they also aren't cutting many jobs.

The unemployment rate could even fall if more people stop looking for work because they think fewer jobs are available.

Wages

Hourly pay is likely to show a 0.3% increase, which is a bit faster than the Federal Reserve likes to see.

The central bank would like to see wages rise a bit more slowly - say 0.1% to 0.2% a month - to make sure labor costs don't start adding to U.S. inflation. Labor is the biggest expense for most companies.

The yearly increase in wages, meanwhile, could move up slightly to 3.9% from 3.8%. Before the pandemic, hourly pay was rising around 3% a year.

Tariffs and immigration

Two of the industries that could be most affected by Trump's policies are construction and transportation.

Construction firms were already having trouble hiring workers before the White House crackdown on immigration. And that could further hinder hiring,

Transportation jobs at ports, shipping and warehousing companies could also take a hit, depending on how quickly the tariffs begin to reduce spending on imports.

April surprise

April is one of the biggest hiring months of the year, but there's no telling how the government's normal seasonal adjustments will affect the raw number.

Hiring could easily look better - or worse - than the report implies. MarketWatch will dig into the details for the answers.