Goldman Sachs Expects Friday's Jobs Report To Disappoint

According to economists surveyed by Bloomberg, the consensus estimates U.S. companies added 149,000 nonfarm payrolls during the month..

Goldman Sachs' David Mericle expects the number to disappoint and come in at 125,000.

"We expect that cold temperatures and snowstorms during the February reference week and the weeks just prior will exert a drag of about 60k on payroll gains," wrote Mericle in a note to clients. "In addition, we view the February employment indicators as a bit weaker than the recent trend, with the sharp decline in the ISM-nonmanufacturing index a particularly worrisome sign."

On Wednesday, we learned that the ISM-nonmanufacturing employment sub-index plunged to 47.5 in February from 56.4 in January. Companies surveyed blamed weather and the Affordable Care Act (aka Obamacare).

While weather certainly had an unfavorable impact, most folks consider it to be a temporary disruption and not reflective of real weakness in the underlying economy.

The number to watch in the report may be the unemployment rate. Mericle believes it probably fell to 6.5% from 6.6%.

"In addition to the declining trend, we expect that the expiration of Emergency Unemployment Compensation at the end of 2013 is likely to put further downward pressure on the unemployment rate in February," wrote Mericle. "To count as unemployed, a person must have actively looked for work in the prior four weeks. Because late December still fell within that four-week window during the January reference week, it would not be surprising to see some of the impact of expired benefits show up in February."

In other words, expect a lot of noise and confusion when the numbers cross at 8:30 a.m. ET on Friday.