By The Numbers
- US Stocks Avoid Closing Down Over 1%, Again
- Dow vs. S&P 500: Which is a Better Investment?
- Unusual Volume: Taleo Jumps After Oracle's $1.9 Billion Offer
- Gas Prices in All 50 States Back Above $3 a Gallon
- Stocks on the Move Now: Caesars Entertainment Soars
- S&P 500 Earnings: Industrials Lead
- Stocks on the Move Now: O'Charley's Rallies
- Dow Rallies to Pre-Recession Levels: McDonald's Leads Since May 2008
- Unusual Volume Leaders: Gilead Sciences Spikes
- Stocks on the Move Now: Abercrombie & Fitch Tanks
EDITOR
ABOUT BY THE NUMBERS
#GIOVANNYMOREANO ON TWITTER
Is ADP Payroll a Good Indicator?
Text Size 
Director of Market Data & Content Services
This morning's ADP National Employment Report showed a much better than expected count of job losses, coming in at a loss of 491,000 jobs lost instead of the consensus of -643,000. While the count is still high, it is a slowdown in the rate of decline and on the news futures jumped to positive territory.
However, how good of an indicator is ADP? The ADP survey uses actual payroll data from ~400,000 of its US clients and only counts private-sector jobs while the US Government's Bureaus of Labor Statistics non-farm payroll numbers (to be released Friday) is a survey of businesses and includes government employees. ADP uses the BLS numbers as a baseline benchmark to which they adjust their numbers. The BLS, on the other hand, adjusts its numbers to account for new businesses that are not yet in its survey and businesses that may have gone under.
 |
Both numbers, therefore, are not 100% accurate and are subject to future revisions but are used as a barometer of the health of the economy. How close are they? The chart above, shows that the two track fairly well to one another. Sometimes the ADP number is higher and sometimes it is lower. Looking back at data since January 2001, the average difference is only 14,000 jobs per month. However, there are times that the ADP number has been as far off from the BLS number as 200,000 jobs (Feb 2001, for example). In the current economic cycle, that range has been a bit tighter but still was off by -117,000 in October 2007 and has had +/-80,000 swings 3 of the past 15 months. If this trend holds for Friday's numbers, it could be another positive for the markets.
On the open, Bank of America [BAC
Loading...
()
], Citigroup [C
Loading...
()
], Disney [DIS
Loading...
()
], General Electric [GE
Loading...
()
], and American Express [AXP
Loading...
()
] are amongst the biggest gainers on the Dow [.DJIA
Loading...
()
].
Comments? Send them to
- Marketing clichés aside, sometimes diamonds are for investing.
- The ‘Fast Money’ traders weigh in on fashion related stocks from apparel to footwear.
- This list of the 10 most active cities for speed traps was compiled by Trapster.com. See if your town is there.
- This Valentine’s Day should prove a love fest for restaurants, as many couples will be dining out.
- Here’s a look at Westminster Kennel Club’s most successful breeds—and how much they cost.
- What kind of homes do celebrity couples share? Here’s our updated list. Take a look.
Data is a real-time snapshot *Data is delayed at least 15 minutes
