Nonfarm Payrolls (Monthly Change) vs Yield Curve Spread (10Y - 2Y)

What Nonfarm Payrolls (Monthly Change) measures

Nonfarm payrolls measure the net change in employment across all sectors except farming. It is the most closely watched indicator of labor market momentum and is released on the first Friday of each month.

The economy added 228,000 jobs in March, a strong rebound from February's 117,000. Economists generally consider 150,000+ jobs per month as healthy growth. For executives, strong payroll numbers confirm consumer spending capacity and may signal the Fed will maintain or raise interest rates. Sector breakdowns reveal which industries are expanding — critical for workforce planning and market sizing.

What Yield Curve Spread (10Y - 2Y) measures

The yield curve spread measures the difference between the 10-year and 2-year Treasury yields. When positive (normal), longer-term bonds pay more. When negative (inverted), it historically signals recession risk.

The yield curve has un-inverted to +0.41 percentage points after being inverted for much of 2023-2024. Historically, the yield curve un-inverting and steepening often occurs just before a recession starts — the recession signal is not the inversion itself, but the re-steepening. For executives, this is a watch-closely moment: the economy may be entering a transition period.

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