Primarily based on ADP-Stanford Digital Financial system Lab collection for October.
Determine 1: Non-public nonfarm payroll employment (daring black), nowcast primarily based on error correction mannequin utilizing ADP-Stanford Digital Financial system Lab collection (blue), +/- 1 commonplace error strains (grey), Bloomberg consensus as of 10/31 (crimson sq.), all in 000’s, s.a. Supply: BLS, ADP through FRED, and creator’s calculations.
The ECM used is estimated over 2021M07-2024M09, and has an adjusted R2 of 0.67, SER of 0.002. Utilizing a easy regression of first log distinction BLS on contemporaneous ADP collection yields a nearly an identical nowcast.
Observe that this can be a mechanical nowcast, primarily based solely on previous BLS information and ADP information. There isn’t any accounting for strikes and hurricanes. Goldman Sachs (Walker/Rindels) notes:
ADP’s measure of employment development has traditionally been much less delicate to pure disasters and Homebase’s information possible misses the influence of the present strikes as a result of its pattern is primarily made up of owner-operator-managed meals and beverage, retail, and repair companies.
