Last month, the Bureau of Labor Statistics delivered a jobs report that only Baby Bear could offer: not too hot, not too cold, but just right. 

The US economy added 187,000 jobs in July. While that figure was well below the breakneck pace of job growth over the past three years, it was roughly in line with the monthly average seen in the decade before the pandemic. 

The unemployment rate settled back down a notch to 3.5%. The jobless rate has calmly drifted between 3.4% and 3.7% since March 2022, the month that the Federal Reserve began an aggressive inflation-fighting campaign that was wholly expected to slow demand and bring unemployment above 4%, if not close to 5%.

The August jobs report, set to be released on Friday at 8:30am ET, is expected to show that the labor market will stay in this sweet spot. Consensus estimates have net job gains at 170,000 and the unemployment rate holding at 3.5%, according to Refinitiv.

The current level of working hours, the quits rate and the rate of job growth can likely be sustained for a very long period, said Julia Pollak, chief economist with online job marketplace ZipRecruiter.

“Those are really good, solid, sustainable numbers that lead to gradual real wage growth, gradual increases in prime-age participation rates that gradually draw more people in and off the sidelines and expand the workforce and the tax base and that have all kinds of long-term benefits.”

“We could be in a place where this ‘Goldilocks’ labor market is sustainable and continues for a long time,” said Pollak. “But there are also considerable risks that the porridge may cool down too much.”