Jack Dunn - Reclaiming Common Sense

The ADP Payroll report provides us the first glimpse of the employment situation in the United states for the month of April. The Payroll Report provides us seasonally adjusted data for jobs, similar to the Current Employment Statistics (CES) Private Sector Data. The problem there is that the CES data is "worker data." The Current Population Survey (CPS) provides us jobs data on full-time and part-time jobs, as well as workforce population data and unemployment data. It is also important to note that the CES and CPS data sets publish both seasonally adjusted and non-seasonally adjusted data. Both the CES data and the Payroll data have undergone major revisions to their data since the first of the year.  This week this column has produced two forecast articles: "April ADP Forecast: Up for All Sectors" and "April Jobs Forecast: Popping Good." The ADP number has been between 241,000 and 249,000 during December 2017, and January, February, and March of 2018. The ADP forecast was for a number of 265,000 jobs.


It was projected that we should see month to month growth in all sectors, except possibly Construction. This was deemed unlikely due to the strengthening new construction data that we have been receiving this year. The seasonally adjusted CES Private sector data was projected to be over 300,000. The difference is the difference in the data sets. What did the ADP report tell us today.  It was projected that we should see April to April growth in all sectors with the possible exception of Natural Resources. This was also dismissed based on increases in rig counts and increasing demand for construction material. What did the April 2018 ADP Payroll Report reveal?


We Saw Month to Month declines in Trade,Transportation and Utilities as well as Information. Construction was up 0.45%. Natural Resources was up 1.67%. The other big gainers were Manufacturing and Professional Business Services.  Financial Activities and "Other services" were the sectors that grew the slowest.


We saw Annual growth in all sectors, except IT. Natural Resources were up 6.17% followed by construction at 3.32% Professional Business Services were up 2.81%, Education and Health were up 2.05%  and Manufacturing was up 1.51%.


Even though this report came in at a mere 204,000 this is up from April of 2017 when ADP reported 177,000 additions prior to the recent revisions which lowered that report to 155,000. March 2018 came in at 241,000 compared to 122,000 during March 2017 (Original reported at 263,000.) There were some surprises in the data with upward revisions to the goods producing jobs data and downward revision to the service sector payroll. This growth rate means that we should see an improving growth rate for the NSA CES data this Friday.


It's the economy.