The August jobs report due out Friday could go a long way toward clarifying whether the Federal Reserve will raise interest rates sooner than anticipated.

As currently defined by the Fed, "sooner than anticipated" would probably mean the first half of 2015, possibly as soon as the first quarter.

Economists are anticipating another solid-but-not-spectacular monthly jobs report with the addition of about 225,000 and the headline unemployment rate ticking slightly lower to 6.1%.

If the job creation number holds to predictions it will be the sixth straight month the U.S. has seen more than 200,000 jobs added.

Fed policy makers have made it clear that labor market data will be an important economic indicator used when determining when to raise rates.

For months the consensus among Fed policy makers has been that rates will move higher no sooner than mid-2015. But that time-frame has apparently begun to shift forward as economic data has improved throughout 2014, particularly in U.S. labor markets.

“Next month, the Federal Reserve is scheduled to end its bond purchase program and the Fed’s forward guidance is beginning to evolve with (Fed Chair) Janet Yellen making it clear that if the unemployment rate continues to fall faster than the Fed expects, hikes in the federal funds rate may come sooner and be faster than are currently anticipated by the market,” said David Kelly, chief global strategist at JPMorgan Funds.

Kelly noted that central bankers have had a string of positive economic data to mull in recent weeks, including an upward revision last week of second quarter GDP growth to 4.2%, an improvement in how consumers view labor market conditions via the Conference Board consumer confidence survey, strong gains in capital goods shipments, the strongest pending home sales figures in 12 months, positive back-to-school chain-store sales and unemployment claims coming in below 300,000 for the third week in the last four.

Then on Tuesday data revealed that U.S. manufacturing activity hit a nearly 3-1/2-year high in August and construction spending rebounded strongly in July, signs that the third quarter was getting off to a strong start.

Wage Growth Also A Key Element

The method by which the Fed will signal an earlier liftoff is likely to reveal itself following the Fed’s next meeting scheduled for Sept. 16 and 17. At the end of that meeting the policy setting Federal Open Markets Committee will release its statement announcing new policies.

While no significant new policies are expected, the Fed could eliminate a key phrase it’s been using for month to describe when rates will move higher. The Fed has said rates will remain at their historically low range of 0%-0.25% “for a considerable period” after the central bank phases out its monthly bond purchasing program known as quantitative easing.

Simply by eliminating that phrase “for a considerable period” from its September statement it would send a strong message to markets that Fed policy makers are now leaning toward moving rates higher sooner than anticipated.

Another key element of Friday’s report from the Labor Department will be wage growth, which analysts are predicting grew at a rate of 2.4% in August, a slightly higher rate than in July.

The slight shift higher in wage growth should add to the momentum now gaining for raising interest rates in the first half of 2015.

Wages have been essentially stagnant for most of 2014, offering justification to Fed policy makers who want to keep interest rates low for the foreseeable future to ensure against another economic hiccough that could set back the hard fought recovery.

Stagnant wages have kept inflation in check, easing a concern that years of Fed stimulus will eventually lead to runaway inflation. Indeed, inflation has been hovering at about half the 2% rate targeted by the Fed as healthy for the broader economy.

But core inflation has started to rise in recent months, another factor that could prompt the central bank to hasten its timetable for lifting interest rates.

“Core inflation numbers, while not worryingly high, are clearly not drifting down,” Kelly added.

Fed "doves" led by Yellen and new Vice Chair Stanley Fischer have pointed to stubborn slack in U.S. labor markets as evidence that the economy isn’t ready for the higher borrowing costs that will come with higher interest rates. But with the unemployment rate dropping and wages slowly moving higher, that argument is getting harder to make.

Meanwhile, Fed "hawks" such as Kansas City Fed President Esther George and Philadelphia Fed President Charles Plosser have been making strong public arguments in favor of raising rates sooner -- possibly in the first quarter of 2015 -- as a deterrent to asset bubbles and runaway inflation.

Follow Dunstan Prial on Twitter @DunstanPrial