· The
ADP National Employment Report, from the payroll processor, indicated
that July private nonfarm payrolls rose 9,000 after a revised 77,000
worker decline during June. Expectations had been for a July decline of
60,000.
·The U.S. Bureau of Labor Statistics will report on July nonfarm payrolls this Friday. Last month, the 77,000 worker decline in ADP's measure of private nonfarm payrolls was accompanied by a 91,000 worker decline in the BLS measure of private sector payrolls.
· According to ADP and Macro Advisers, the correlation between the monthly percentage change in the ADP estimate and that in the BLS data is 0.90.
· Higher employment in the service producing industry accounted for the gain in ADP's measure for July with a 74,000 (1.1% y/y) increase. Small payrolls rose 56,000 (1.6% y/y) while medium sized payrolls increased 20,000 (1.2% y/y). Large service producing payrolls reported a 2,000 (-0.4% y/y) decline which was the seventh drop in the last eight months.
· Goods
producing payrolls fell by 65,000 (-2.5% y/y) led by a large decline of
29,000 (-2.7% y/y) in medium sized payrolls and a 30,000 (-4.3% y/y)
worker decline in large payrolls.
· The ADP sub-index for large payrolls overall fell 32,000 (-1.3% y/y) following a 51,000 worker drop during June.
· A 9,000 (+0.4% y/y) worker decline in medium sized payrolls followed a 33,000 shortfall during June.
· Small sized payrolls in July rose 50,000 (1.2% y/y) and that followed a meager 7,000 June uptick.
· ADP
compiled the estimate from its database of individual companies' payroll
information. Macroeconomic Advisers, LLC, the St. Louis economic
consulting firm, developed the methodology for transforming the raw data
into an economic indicator.
· The ADP
National Employment Report data is maintained in Haver's USECON
database; historical data go back to December 2000. The figures in this
report cover only private sector jobs and exclude employment in the
public sector, which rose an average 11,083 during the last twelve
months.
· The
full ADP National Employment Report can be found here,
and the ADP methodology is explained here.
· Interpreting the Great Moderation: Changes in the Volatility of Economic Activity at the Macro and Micro Levels from the Federal Reserve Bank of New York is available here.