Or, “You want the truth? You can’t handle the truth!”

If (1) private NFP as measured by BLS equals ADP private NFP in October, ADP private NFP consensus gain of 28K is realized, (3) the 100K government employees signed up under the deferred resignation program (DRP), who effectively resigned on September 30, were not re-employed by the week of October 12th, and (4) net government employment gain is zero, then we have the following picture.

Figure 1: ADP Private nonfarm payroll employment (blue, left scale), Bloomberg consensus implied employment (light blue square, left scale); BLS benchmark-implied nonfarm payroll employment (black, right scale), implied NFP (chartreuse, right scale), all in 000’s, s.a. Source: ADP, BLS via FRED, and author’s calculations.

The chartreuse line assumes +54K for September, per Bloomberg consensus, and -72K (change in private NFP of +28K, -100K for government employees).

This path is upwardly biased insofar as (1) ADP private NFP has been rising faster than preliminary benchmarked BLS private NFP (but slower than nonbenchmarked), and (2) total government employment dropped 16K in August, even in the absence of the deferred resignation program participants registering as losses.