Using the correlation between log first differences for BLS nonfarm payroll employment and ADP, I get the following prediction or “nowcast” for the BLS number to be released tomorrow:
Figure 1: BLS nonfarm payroll employment sebries (black), and predicted (light blue), +/- 1 std error (gray lines), and Bloomberg consensus of 4/6, all s.a. Source: BLS, ADP via FRED, Bloomberg and author’s calculations.
I estimate this specification over the 2021M06-2023M02 period :
Δ pnfp_blst = 0.001 + 0.593 Δ pnfp_adpt + ut
Adj. R2 = 0.63 SER = 0.0010, n = 21, DW = 2.38. (Coefficients significant at 5% msl using HAC robust standard errors bold ital.)
Notice a simple autoregression of first differenced private NFP yields a considerably lower adjusted R2 (0.19). Lagged private NFP from BLS does not enter significantly if entered into the above equation.
In terms of numbers (rather than percentages), Bloomberg consensus is for a 215K net increase, while the model implies 281K. The Bloomberg consensus is the average of forecasters who are using a variety of approaches, some of which include disaggregating to individual categories, forecasting, and then aggregating (as in AS‘s approach for total NFP). I use a simpler approach (which I do not claim is necessarily better).
Below is the underlying data (in levels).
Figure 2: BLS nonfarm payroll employment series (black), and ADP series (light brown), both in 000’s, s.a. Source: BEA, ADP via FRED.
My guess is around 200,000. The warm winter frontloaded much employment into the first 2 months as we aren’t quite done with personal services recovery . Inflation likewise will show almost no growth in March despite oer. Things are picking back up in April though oer at around a peak.. The question of when it’s plunge begins is next. I am guessing by years end, nfp will be down around 150, precovid trend.
I like 208k for a March NFP number. Usually banks get the number a little high. This one is difficult though.
Luigi Zingales made some very interesting comments on Bloomberg Surveillance today. Related to PhDs and Fed board members without economics PhDs. And Menzie thought I was mean for dissing Georgetown Jerome. I ain’t got nothing on Luigi Baby.
Zingales manages in short order to lay out the problems in the banking sector. It’s useful to hear someone who knows what’s what saying the banking problem persists, and that it’s the result of bad bank management and a rapid rise in rates. None of this claptrap about all one or all the other.
Among the good things in this interview, two stand out for me:
1) The moderators open with Zingales’s call for a review of the Fed’s decision-making process. Yes, please, but with one thing in mind – just because you find problems with a decision-making process doesn’t mean there is some other process which would work better. Even if there is some hypothetical better process, our political culture is likely to take an effort to improve the system as an opportunity to screw it up.
2) Zingales wants increased resilience in banking. That’s what we learned back in the Great Recession, but apparently not well enough. Policy shocks can be buffered by more more resilient banking practices. Bad management can be buffered by enforcing more resilient banking practices. Resilient practices are generally more conservative, less focused on short-term profit and ultimately less reliant on government backstops.
Bankers lobby against anything which limits short-term profits. Screw ’em.
I saw he had Johnny Cuckrant on his podcast sometime in the last couple years. Trying to decide if my blood pressure might kill me if I listened. That listening will take at least two shots of extra-strength Aspirin.
The Tennessee Three are 3 Democrats who dared to voice the concerns over guns for their citizens and for that the GOP friends of the NRA voted to remove them from office:
https://www.cnn.com/2023/04/06/us/tennessee-democrats-office-removal-vote/index.html
A vote to expel Democratic Rep. Gloria Johnson from Tennessee’s Republican-controlled House of Representatives has failed, a week after she and two other Democrats led a gun reform protest on the House floor. The House earlier expelled Rep. Justin Jones over that protest, which followed a mass shooting at a Nashville school. The third Democrat involved, Justin Pearson, also faces a possible vote on his removal from office Thursday. The vote over rules violations for Johnson was 65-30. Expulsion from the House requires a two-thirds majority. The vote for Jones split along party lines, 72-25.
Protesters flooded the state Capitol on Thursday as the legislators were set to take up three resolutions filed by GOP lawmakers Monday seeking to expel Jones, of Nashville, Johnson of Knoxville and Pearson of Memphis, a step the state House has taken only twice since the 1860s. “There comes a time where people get sick and tired of being sick and tired,” Jones said in a speech prior to a vote on his expulsion. “And so my colleagues, I say that what we did was act in our responsibility as legislators to serve and give voice to the grievances of people who have been silenced.” “We called for you all to ban assault weapons,” he said, “and you respond with an assault on democracy.” Jones added: “How can you bring dishonor to an already dishonorable house?”
Maybe Justin Jones got to a few Republicans after this young black member was expelled. I’m glad Gloria Johnson survived but could it be she survived because she is white.
The Tennessee Republican members of the House need to be kicked out of office the next time the citizens of Tennessee get to vote.
I say this with no real disagreement with your personal opinions as relates to gun violence, but this reminds me of several past comments you made, seemingly making New York state/city out to be some kind of utopia, and then later sarcastically telling me you were glad to be informed there were racists in New York (yes, you “knew that already”). Tennessee is not a liberal state, and you’d have to go back a few decades to show it ever was. It is a predominantly pro gun state. There’s a reason why Associated Press stories refer to Tennessee as “ruby red”. Will the three legislators be voted back in later if they are expelled?? An ABC reporter sounded like she was pretty certain the 3 would be voted back in, but frankly I don’t trust TV journalists for the most part, because most of them are broadcast majors, not real journalists.
https://apnews.com/article/gun-laws-tennessee-shooting-6192267a5ef5791416adda36667d287b
That’s the map below.
https://www.cnn.com/interactive/2022/politics/us-redistricting/tennessee-redistricting-map/
You see much blue there?? The reality is, most American voters get exactly what they ask for. In a nation as functionally illiterate as America is, no doubt a sad state (no pun intended) of affairs. But Americans indeed largely get what they ask for at the ballot box. Tennesseans vote like they enjoy gun violence and Tennesseans GET/GOT the things they voted for. These gun laws were not “forced” on them. And it helps no one to imply that they were.
As someone who lived in Nashville and did not venture out into the country – those maps said it all. Nashville used to be blue but now it is as if it does not exist,
Some of that, as you know, is because of the redistricting, or “reshaping”/redrawing of the district. You share some of the blue with the other red parts (sprinkling out the blue to the red) and you get more red districts. You can see how they did it just looking at the Nashville area. The ones that went pink got the “blue sprinkle”. If you just look at the county Davidson is still blue.
I have never been to Memphis so maybe I should not feel this way but every time this city gets mentioned, I am reminded of 1968 when it was the city where MLK was murdered. It seems Memphis is the only blue area left.
Roughly 140,000 Tennesseans were disenfranchised by the expulsion of their duly elected representatives. Notably, two duly elected black men were expelled, while their white, female colleague maintained her seat by one vote. Also notable is that the affront for which 140,000 Tennesseans, and nearly 210,000 Tennesseans, were denied democratic representation is that the three legislators spoke out – loudly – in favor of gun control. I won’t claim this is unprecedented – disenfranchisement of voters is how we do things now – but the method is pretty novel, and it was used to supress talk of protecting children from guns.
That’s Tennessee.
Well said. I have not been in TN since 1980 and it looks like I’d not be comfortable going back.
Pretty lame if you ask me. He says some very vague things about how the white legislator brought her attorney to the meetings to expel them, but still never really specifies what the hell the difference was:
https://ondemand.npr.org/anon.npr-mp3/npr/atc/2023/04/20230407_atc_rep_jody_barrett.mp3?d=427&size=6834931&e=1168728769&t=progseg&seg=10&sc=siteplayer&aw_0_1st.playerid=siteplayer
3 people with a BULL HORN! Yea – the same as January 6, 2021. This dude is a tool.
“I’m an attorney”. So I guess the white woman having another attorney made it OK to screw two young black men? This is the problem with attorney – arrogant blowhards with zero principles.
The difference between the4 TN insurrection and the Jan 6 US insurrection is what?
To these eyes the TN legislators acted directly against their members only, while the US Democratic Congressional members acted against the populace. All done legally?
Which brings up the difference between the Russian jailing of a WSJ journalist versus the same US Democratic DA arresting an ex-President? Isnlt a journalkist’s r9ole to observe and report? To spy: “intransitive verb : to observe or search for something” https://www.merriam-webster.com/dictionary/spy
Couldn’t any journalist be called a spy, anywhere, any time?
@ CoRev
I’m having a very difficult time trying to figure out your analogy. What/which American journalist involved in the New York arrest/indictment are you trying to draw as analogous to the WSJ journalist being abducted??
“The difference between the4 TN insurrection and the Jan 6 US insurrection is what?”
https://nypost.com/2021/01/08/rioters-left-feces-urine-in-hallways-and-offices-during-mobbing-of-us-capitol/
https://www.dailymail.co.uk/news/article-9126409/MAGA-mob-rioters-smeared-POO-Capitol.html
It’s also worth noting, no one, as far as I have heard brought a noose to the Tennessee protest or threatened to hang anyone. Anyone who has proof of that at the Tennessee protest I would love to see it.
I’m glad you took on CoRev’s disgusting filth. If I had to do so – me thinks our host would have to ban me from the profanity CoRev would rightfully deserve.
CoVid is repeating the idiocy spouted by Republican members of the Tennessee legislature. Speaking out against gun violence in the Tennessee legislature is a bigger threat to our country than January 6 insurrectionists trying to overturn presidential election results.
CoVid once upon a time tried to mount superficially reasonable arguments in service of right-wing lies. I guess word has com down from his ideological masters that he should start repeating the Republican echo-chamber dreck outside the echo chamber.
Oh, also, nobody was as a result of elected representatives speaking in the Tennessee legislature. There were 138 injuries during the Capitol insurrection. No one had to evacuate or shelter in place in Tennessee. So far, no evidence a crime was committed when elected representatives spoke before the body to which they were elected. Ther have been over 1000 arrests in conjunction with the January 6 insurrection, with over half pleading guilty, others convicted in trials.
All of this is publicly available information. CoVid seems to think reality is a poor basis for one’s views.
So, in the TN vs US Capitol Jan 6 examples, there has been no actual ?Constitutionally legal? differences shown. I did point out the singular difference in my comment: “To these eyes the TN legislators acted directly against their members only, while the US Democratic Congressional members acted against the populace. All done legally?”
Moreover, no one wanted to even try explaining a difference, if any, between the Russian jailing of a WSJ journalist versus the same US Democratic DA arresting an ex-President? Isn’t a journalist’s role to observe and report?
The violently hating and illogical liberal mind is an amazement.
Damn CoRev – can’t you bother to write complete sentences? Your little comment was beneath meaningless babble. I know you want to excuse the domestic terrorism on 1/6/2021 but you utter incompetence at drawing an analogy is incredibly laughable.
@ CoRev
“The difference between the4 [Sic] TN insurrection and the Jan 6 US insurrection is what?”
Sometimes, especially with low IQ people, pictures or video can be helpful. Possibly if smearing feces on the Congressional walls or bringing a noose and threatening the Vice President’s life is hard for you to understand in relation to typical protests, this video will help you CoRev https://twitter.com/thomas__barker/status/1643396957837352960?cxt=HHwWgIDTje-0ws4tAAAA
It’s difficult to free a fool from the chains he so reveres. CoRev never disappoints.
Still no meaningful comment REFUTING the analogy? Losing another opportunity to show your logical superiority while lowering the comment level to personal attacks just confirms: The violently hating and illogical liberal mind is an amazement.
CoRev
April 9, 2023 at 4:10 am
Exhibit A why no one should bother with any of the trolling from the CoRev. You are not even trying to have an honest conversation. Of course you never bother with honesty so why start now?
Just smiling while living your heads. Y’ano, that could all end if you could refute what was claimed, but nooo, you wish to show the duperiority of your violently hating and illogical liberal minds.
It is an amazement.
Refuting a fool? A fool’s errand indeed.
Competition for the title has been fierce, but I have to say: with these posts, CoRev has cemented his spot as Econbrowser’s champion Village Idiot.
Dr. Chinn declared JohnH as the 2nd dumbest person on this webblog. I was wondering who was #1 but yea – it is obvious that CoRev takes the crown.
He actually believes his latest raving and rambling is logical . That deep end is drawing nearer with CoRev—logically?—careening toward the edge.
China non-manufacturing PMI. Interesting number, especially if you look at the 10 year graph.
https://tradingeconomics.com/china/non-manufacturing-pmi
Michael Pettis’s Twitter feed is worth checking if you haven’t recently. He mentions a Setser post. These are the two “white dudes” I trust the most on China economic data/ direction
Well, it’s all over in Tennessee. Of the three Democrats involved in the protest, they voted to expel the two Black men but not the white woman.
Interesting.
Part of the state still harbors the KKK. Alas.
I have heard that the seats will be filled by appointment, without county official doing the appointment. If true, this raises the possibility that the same two gentlemen will be back at work soon. I have also heard that once removed and reinstated, they cannot be removed for the same cause a second time.
Of course, speaking on the floor of the legislature was the “cause” in the first case. I’m sure something equally ridiculous can be invented to remove them a second time.
Anyone predicted 236 thousand?
https://www.bls.gov/news.release/empsit.nr0.htm
Total nonfarm payroll employment rose by 236,000 in March, and the unemployment rate changed little at 3.5 percent
Labor force participation rate went up a bit and the employment to population ratio rose from 60.2% to 60.4%, highest since before the pandemic.
Our good man “AS” got close to the 236k. In fact it wasn’t far off from consensus. I flunked guessing 101 again and was 28k on the low end. There goes sending my CV to Lazard again.
Those bastards……
Speaking of bastards…… we better send some depression meds to Larry Summers’ office. He’s gonna be downcast when he reads this:
https://tradingeconomics.com/united-states/average-hourly-earnings
Moses,
Thanks for the mention.
I am working on the April forecast and so far, see a much lower monthly increase for April compared to March.
I usually make my forecast a month in advance and am not very good at adjusting the forecast for economic changes that happen during the current month.
Insider dope:
Many forecast surveys collect data for the coming two weeks on Thursday and Friday every week.. Which means a fresh forecast completed Thusday two weeks before the release is of value to a forecaster’s employer. Forecast write-ups often mention initial jobless claims data as of the week of the 12th – survey week for the establishment survey – and similar stuff.
So if you are ever in a job interview and the interviewer asks, that’s what you need to say you can do.