A Puzzle: Private NFP and the Preliminary Benchmark vs. Current Official [updated]

The puzzle remains: despite an under-consensus 99K addition to private ADP-Stanford NFP (far below consensus 144K). ADP cumulative change above CES cumulative change, while preliminary benchmark is below.

The ADP survey cumulative increase in private NFP since 2023M03 is 3.2mn through August, more than the 2.8mn reported in the current official CES series through July.

In contrast, the preliminary benchmark indicates 819 thousand less in March 2024 than the current official series. Assuming the increases in private NFP since March 2024, the increase in employment is 2.0mn (not 2.8 mn through July).

Figure 1: Cumulative increase in private NFP since March 2023 according to CES (blue), according to ADP-Stanford Digital Economy Lab (tan), according to preliminary benchmark (red square), all in 000’s, s.a. Source: BLS, ADP via FRED, BLS, and author’s calculations.

The ADP-Stanford Digital Economy Lab series is not based on a survey, but actual check cutting operations. The Preliminary Benchmark relies upon QCEW (unemployment insurance). While the QCEW is a census, that census data gets updated. In addition, some employment will not be captured in the census, since some employment is not reported by firms to the tax authorities. Hence, Goldman Sachs thinks the effective downward revision is about 300K, instead of 818K, for the total NFP (no separate figure reported by GS for private NFP).

 

22 thoughts on “A Puzzle: Private NFP and the Preliminary Benchmark vs. Current Official [updated]

  1. JV

    The ADP series covers “more than 25 million employees.” They use weights based on QCEW data to get the national number, presumably based on the edition available when they reassess their weights at the beginning of the year. I would have guessed that was Q32023, but it looks like there is a significant divergence that starts mid Q2? So maybe ADP is using outdated 2023Q2 weights, so for some reason, they could be overweighting the checks they see cut and underweighting employees who are no longer on an ADP payroll. I would be curious what the raw ADP data looked like without any weighting.

    1. pgl

      Ej Antoni keeps putting forth this nonsense. Check out my prior comments as I have noted the economics of Giffen goods and how anyone who thinks dinner sausage is a Giffen good never passed basic microeconomics.

  2. Moses Herzog

    Just wanting to know if I am all alone here. Does anyone else think that instead of images of Mickey Mouse drinking beer with a cigarette hanging out of his mouth or SpongeBob wearing Gestapo garb that maybe air traffic control at major airports might just possibly be a better application of “AI”??? Asking for the outside of the norm section of the 2024 crowd.

  3. Moses Herzog

    Well, I just watched the Baltimore–Kansas city game, and as I often say after watching a team scrape and claw and exert themselves and then still lose the game “That’s toe bad”

  4. pgl

    BLS report out – payroll survey shows 142,000 increase.

    OK you household survey freaks. The increase was 168,000.

  5. pgl

    https://www.bls.gov/news.release/empsit.nr0.htm

    ‘In August, average hourly earnings for all employees on private nonfarm payrolls increased by 14 cents, or 0.4 percent, to $35.21. Over the past 12 months, average hourly earnings have increased by 3.8 percent.’

    These are nominal increases but the increase in nominal wages is greater than the rise in consumer prices. So real earnings continue to rise. A fact you will not see over at Antoni’s blog or on Faux News.

  6. pgl

    Vance says school shootings are ‘a fact of life.’ That’s cowardice, not leadership.
    https://www.msn.com/en-us/news/opinion/vance-says-school-shootings-are-a-fact-of-life-that-s-cowardice-not-leadership/ar-AA1q6mw6?ocid=msedgdhp&pc=U531&cvid=f8b3c106e4984a12bff14cf7f47bc3d8&ei=15

    “In the wake of a deadly Georgia school shooting, JD Vance, the Republican who incorrectly thinks he’s qualified to be vice president of the United States said this at a Thursday night rally: “We don’t have to like the reality that we live in, but it is the reality we live in.” I’m sorry, what? A 14-year-old student is suspected of using an assault-style rifle – reportedly a gift from his dad – to shoot and kill two Apalachee High School students his same age and two teachers while also injuring nine others. As with any school or mass shooting, there are victims well beyond those shot and their families, children and adults whose lives are forever damaged by the trauma. And Vance’s response the day after that tragedy is “that’s the reality we live in”? Pardon my attempt at publishing profanity, but Vance can (expletive) right off if he’s ready and willing to accept armed children committing routine acts of carnage in American schools as our reality that just has to be accepted.”

    Vance is echoing Trump. And they have just told the parents in Georgia and every other state – “we don’t give a damn about your kids”. Hey – neither does Bruce Hall.

  7. pgl

    EJ Antoni with his pretend Ph.D. is harping on the fact that the employment to population was 61.1% before the pandemic but seems to be stuck at 60.0% now. Now if this retarded right wing arrogant blow hard knew the first thing about labor economics, he might want to consider how the baby boomers are retiring. Economists who know what they are doing might look at something like this:

    https://fred.stlouisfed.org/series/LNS12300060
    Employment-Population Ratio – 25-54 Yrs.

    80.6% before the pandemic and 80.9% now.

    OK – here’s my question. Is Antoni really THIS stupid? Or does he know better but he is your usual Trumpian lying rear end?

      1. pgl

        EJ Antoni repeated this lie on Twitter today. Of course you may have missed it given all of the other pieces of disinformation EJ was spreading.

      2. pgl

        Zerohedge equates foreign born to illegal aliens? I get he is a flaming racist and a serial liar but DAMN!

      3. pgl

        Kevin Drum is not an economist but he presents some relevant information on this topic:

        https://jabberwocking.com/raw-data-labor-participation-for-prime-age-native-born-workers/
        Raw data: Labor participation for prime age, native born workers

        Dr. Chinn might have a laugh that Kevin is complaining that using BLS data is hard work but the implications of what he presents puts to shame the trash from both Antoni and Zerohedge.

        Now we might ask Bruce Hall to read Kevin’s post but alas even this clear discussion is why over Brucie’s little brain.

    1. pgl

      Hey Brucie – this racist trash has been debunked on this blog many times. Now I get you want to please your KKK companions. I get you are under a lot of pressure to spread MAGA disinformation. But dude – could you make it more obvious that you have ZERO interest in reading actual economics? Damn!

    2. pgl

      Hey Brucie – I can see why you raised your latest racist trash!

      Experts warn: GOP using “great replacement fears” to push new “voter suppression tactics”
      https://www.msn.com/en-us/news/politics/experts-warn-gop-using-great-replacement-fears-to-push-new-voter-suppression-tactics/ar-AA1q9H6y?ocid=msedgdhp&pc=U531&cvid=769a2b10f44e4e26b16ae0942db4cf09&ei=6

      In Louisiana, a state that explicitly bans noncitizen voting in its constitution, Republican Gov. Jeff Landry recently signed an executive order requiring state agencies that offer voter registration forms to include a disclaimer that only U.S. citizens can vote. “Voting is a privilege reserved for American citizens, and it’s crucial that we uphold this standard,” he wrote in a Sunday post to X highlighting the order.

      Landry and Brucie boy agree. Voting is a privilege reserved for white people. The browns and blacks should not be allowed in vote in Brucie’s version of America.

      1. Ivan

        There is a substantial effort from Trump to build up the false narrative that millions of illegals will be voting for Harris. This is the standard Trump way to build up an excuse for him being a loser. However, it is also dangerous because the MAGA lunatics who don’t want to believe they lost, are being set up to think their loss was due to cheating – even if there is no evidence.

        It is an absurd idea that someone who is trying to hide from the authorities and/or would risk being deported if voting, would take the risk of trying to illegally register to vote. Yes there has been cases of non-citizens trying to register but only a handful of cases where they succeeded and voted. There is no upside for a non-citizen to vote and a huge downside since they have a 99% change of being found out and facing consequences.

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