General Motors workers on the engine line at the General Motors Spring Hill Manufacturing plant in Spring Hill, TN. (Photo by Sanford Myers for General Motors) Sanford Myers | General Motors

Companies seem to have done a lot of hiring in March, and if Friday's jobs report is as strong as expected, it could go a long way towards reducing speculation that a recession is coming and that the Fed will have to cut interest rates to stop it. Like every jobs report, this one is important, but economists say even more so, after the stunningly weak February report, with just 20,000 jobs created. That data added to growing concerns this winter that the economy could tip into a recession sometime in the next year. But economists believe that report was an anomaly, and the real pace of job growth is closer to the consensus forecast for March of 175,000 payrolls, according to Dow Jones. Economists also expect an average hourly wage increase of 0.3 percent and an unchanged unemployment rate at 3.8 percent, when the report is released at 8:30 a.m. ET Friday, according to Refinitiv.

"It's an important number. I will wave an all clear banner if the number's good," said Michael Gapen, chief U.S. economist at Barclays. Gapen expects 175,000 jobs, wage growth of 0.2 percent and a lower unemployment rate, at 3.7 percent. "This is one of the numbers that's going to help shape market expectations for what the Fed needs to do and where the economy is going," said Societe Generale senior U.S. economist Omair Sharif. Sharif is forecasting 200,000 jobs. Economists have been blaming February's job weakness and the uneven quality of first quarter data, in part, on the five-week government shutdown and brutal winter weather in January and February. The number of economic reports that fell short of expectations have far surpassed the ones that were better, and the Citi Economic Surprise index, which tracks the difference between them, fell to its lowest level since June, 2017.

February anomaly?

Diane Swonk, chief economist at Grant Thornton, expects just 165,000 payrolls and said the unusual circumstances that hit jobs in February could continue to impact employment data. "A lot of it was the loss in construction and February was another polar vortex month, so some of that should just come back. There was noise from the government shutdown," she said of February. She said manufacturing may not come back that much in March, due to the shutdown of GM's Lordstown plant in early March. "The way we read [the jobs report] last time, was that it felt like a shut down story that artificially raised payrolls in January and reduced them in February," Gapen said. "Given the length of the shutdown, it may be that furloughed government workers and contractors went out and got part time work, and they were double counted. It would account for why January was so strong and February was weak." January, in fact, was very strong, with an above trend 311,000 jobs created. Sharif said the weather appears to have been a major factor in February's weakness, with 390,000 workers saying they could not get to work due to weather, compared to an average 310,000 for Februarys going back to the late 1970s. More people also reported that they were forced to work part-time, he added. The March employment report comes as some data has started to look better, like the closely watched ISM manufacturing survey, rebounding in March more than expected. The latest unemployment claims at 202,000 were the lowest since 1969, and , existing home sales rose 11.8 percent in February. Auto sales also improved in March, but February's retail sales showed another month of softer than expected spending by consumers, a worrying sign. "If we get a number like 175,000, 180,000 that tells you we're moderating from last year's average of 220,000. It's still a good number, but not a 220,00 or 225,000, and it tells you [employment] is cooling like the rest of the economy is cooling off," said Sharif. "Even if you get a good number and we get away from that narrative, and there's no recession, it's going to be hard for people to argue the Fed should raise rates because the inflation numbers are soft." Sharif said he expects

PCE inflation to drop to 1.70 percent at the end of the month, below the Fed's target of 2 percent.

GDP forecasts rebounding

First quarter growth forecasts have been rising with new data releases, and now some economists expect growth at more than 2 percent, rather than the 1 percent pace expected several weeks ago. As the outlook for growth stumbled in the first quarter, the Fed signaled it was on hold and dropped its forecast for two rate hikes this year to no rate hikes. But markets took the Fed's dovishness as a sign the economy could be in even worse shape and the Fed would have to actually cut rates in 2019 to prevent a recession. The White House also is calling for a half percentage point rate cut, even though most economists are not forecasting rate cuts this year.