Investors Brace Themselves for Poor Jobs Report

Stock markets around the globe remain on high alert for violent volatility in front of the all-important U.S. jobs report, which is scheduled for release this Friday at 8:30 a.m. ET. The consensus estimate for a month-to-month jobs loss is a primary reason for the volatility, but the question remains on the amount of losses to be reported.

In May, the U.S. government released its report showing over 400,000 net new jobs were added to the economy. However, the data was perceived to be a negative because the majority of those new jobs occurred in the form of temporary census workers. Analysts, and would-be job seekers, are anxious to see high growth figures in the private sector, which has been stubborn in adding to its payrolls.

That could change this week, though. Wall Street economists are anticipating a negative number due to the one-quarter of census workers that have been terminated in the last 30 days. However, there is expected to be a jump in private sector hiring, and that could very well be enough to send stocks higher around the world.

"Most people realize the employment report is going to show a lot of the census jobs from a month ago have disappeared with the completion of the census," said Fred Dickson, chief market strategist at D.A. Davidson in Portland, Ore., to CNNMoney. "But if the payrolls number isn't pretty close to consensus, there could be some disappointment and you'll see stocks drop."

That's considering the headline number, and the current estimate by economists and analysts is calling for a June reading of minus 100,000 net new jobs. This is an absolute horrible figure that will cause a great deal of concern for investors.

"The market is going to be nervously looking at the economic data because what's been released over the past few weeks has on balance been disappointing," added Dickson.

Those reports Mr. Dickson is referencing were the poor retail sales figures and horrific numbers from the housing sector. Both sent messages to investors and analysts that the country remains vulnerable to a double-dip recession.

Adding to the anxiety is the lack of hiring in the private sector. Without jobs, people no longer spend and considering 70% of the country's gross domestic product comes from the American consumer, the continued slowdown in payroll additions is crushing the spirit of spending, thus resulting in a negative impact for the overall economy.

"The truth is that without job creation, we're in for a tougher time, and I mean real job creation, not temporary job creation, not part-time job creation – real job creation," said Kenneth Polcari, a floor trader at the New York Stock Exchange with Icap Corporates, to Reuters.

One key piece of data that is expected to show an increase is the unemployment rate, which currently stands at 9.7%. Wall Street consensus is expecting the figure to rise to 9.8%.

Unemployment peaked at 10.2% in October, just one year after Wall Street's meltdown resulted in the current global financial crisis.

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