Goldman sees World Cup adding 40,000 jobs to June payrolls

The June nonfarm payrolls report due Thursday could exceed the 110,000 consensus estimate by a significant margin, with Goldman Sachs estimating World Cup-related hiring added roughly 40,000 positions during the month.

"Homebase data suggests the World Cup has had at least a modest impact on hiring, contributing about 40,000 jobs for the month," Goldman Sachs economists wrote in a note Tuesday.

The estimate comes as ADP data Wednesday showed private payrolls rose by 98,000 in June, below the 118,000 consensus forecast. Leisure and hospitality employment gained only 2,000 jobs, suggesting the World Cup boost was not yet visible in that data set. The services sector added 96,000 positions, led by education and health services, while goods-producing industries added 2,000.

A stronger-than-expected headline number would complicate the Federal Reserve's policy calculus ahead of its July 29 meeting. Markets currently price a 54.5% probability of a rate hike by year-end, and a strong jobs report could reinforce that view. If the World Cup boost proves real, the headline NFP figure could land between 150,000 and 180,000, well above the 110,000 consensus.

The ADP report, jointly developed with the Stanford Digital Economy Lab, has been an unreliable predictor of the official BLS payrolls figure. The average absolute error of ADP's forecast since January 2023 has been 79,000, with the gap exceeding 100,000 one-third of the time, according to Samuel Tombs, chief U.S. economist at Pantheon Macroeconomics.

Nonfarm payrolls have averaged roughly 147,000 per month over the past three months, above the 100,000 breakeven rate estimated by the Atlanta Fed for keeping the unemployment rate stable. The jobless rate has held at 4.3% for four consecutive months. The last time the unemployment rate stayed at that level for this long was in early 2022, when the labor market was still recovering from pandemic-era disruptions.

Hiring Plans Signal Caution Beyond World Cup

A separate report from Challenger, Gray and Christmas showed planned layoffs by U.S.-based employers dropped 53% to 45,849 in June. Employers announced 443,604 job cuts in the first half of 2026, down 40% from the same period last year. However, hiring plans fell 44% from May to 10,933, suggesting companies remain cautious about adding headcount outside of event-driven demand.

"The pace of layoffs cooled considerably in June, similar to plans last June and as is typical for summer months," said Andy Challenger, chief revenue officer at Challenger, Gray and Christmas. "That said, the cuts we are seeing remain concentrated in technology, and artificial intelligence continues to reshape how companies think about headcount."

The Conference Board survey released Tuesday showed the share of consumers viewing jobs as "hard to get" rose in June to the highest level in nearly five and a half years, pointing to underlying softness in the labor market that the headline payrolls number may mask.

If the World Cup boost materializes as Goldman expects, it would represent a temporary distortion rather than a structural improvement in hiring. The tournament, jointly hosted by the U.S., Canada and Mexico, generated 40,000 positions across hospitality, security, transportation and event management — roles that are largely seasonal and may unwind once the event concludes.

A beat on payrolls would likely push Treasury yields higher and strengthen the dollar, as traders reduce expectations for near-term rate cuts. The 10-year yield, which traded near 4.15% this week, could test the 4.25% level if the headline number surprises to the upside. Conversely, a miss below 100,000 — even with the World Cup adjustment — would revive bets on rate cuts, with OIS markets potentially pricing a move as early as September.

The S&P 500 has rallied 3.2% over the past two weeks as investors priced in a soft-landing scenario, but a hot payrolls print could reignite rate-hike fears and pressure equities. The dollar index, which has held near 104.5, would likely strengthen on a strong report, potentially weighing on emerging market currencies and commodity prices.

This article is for informational purposes only and does not constitute investment advice.