EconoIndicators / ADP Employment Report

Economic At a Glance Logo
ADP Employment Report At a Glance

Total Nonfarm Private Employment: 116,015,000
Monthly Change: Down 79,000
Products Producing Sector: 21,749,000
Monthly Change: Down 76,000
Service Producing Sector: 94,266,000
Monthly Change: Down 3,000

Technorati Tags: ADP, employment, jobs, payroll, report

Wednesday, July 2, 2008, 8:15 A.M. ET
Nonfarm private employment decreased 79,000 from May to June 2008 on a seasonally
adjusted basis, according to the ADP National Employment Report®. The estimated
change in employment from April to May was revised down from an increase of 40,000
to an increase of 25,000.
This month’s decrease in employment was broad based across industrial sectors and
suggests continued weakness in employment.
Employment in the service-providing sector of the economy declined 3,000, the first
decline since November 2002. Employment in the goods-producing sector declined
76,000, with manufacturing employment falling 44,000, marking their nineteenth and
twenty-second consecutive monthly declines, respectively.
Large businesses, defined as those with 500 or more workers, saw employment decline
51,000, while medium-size companies with between 50 and 499 workers declined by
35,000. Employment among small-size businesses, defined as those with fewer than 50
workers, advanced just 7,000 during the month.
Two sectors of the economy hit hardest by recent problems in mortgage markets have
been residential construction and financial activities related to home sales and mortgage
lending. Today’s report suggests no lessening of the recent strain on employment in
these industries. In June, construction employment dropped 34,000. This was the
nineteenth consecutive monthly decline, and brings the total decline in construction jobs
since the peak in August of 2006 to 349,000. In addition, employment in financial
activities declined 3,000 during the month.
For information on the construction and use of the ADP Report, please visit the
methodology section of the ADP National Employment Report website at
http://ADPemploymentreport.com/methodology.aspx.
DERIVED FROM ADP PAYROLL DATA
Table 1. Employees on nonfarm private payrolls by selected industry sector and size
(In thousands)
Jan.
2008
Feb.
2008
Mar.
2008
Apr.
2008
May.
2008
Jun.
2008p
Change
from:
May. 2008 -
Jun. 2008p
Total nonfarm private……………116,071 116,053 116,056 116,069 116,094 116,015 -79
Small (1-49)……………. 51,087 51,103 51,156 51,199 51,249 51,256 7
Medium (50-499)………. 45,605 45,603 45,606 45,591 45,585 45,550 -35
Large (> 499)………….. 19,379 19,347 19,294 19,279 19,260 19,209 -51
Goods-producing………….. 22,064 21,993 21,915 21,864 21,825 21,749 -76
Small (1-49)……………. 8,020 7,999 7,990 7,978 7,975 7,948 -27
Medium (50-499)………. 9,716 9,688 9,663 9,635 9,613 9,586 -27
Large (> 499)………….. 4,328 4,306 4,262 4,251 4,237 4,215 -22
Service-providing…………… 94,007 94,060 94,141 94,205 94,269 94,266 -3
Small (1-49)……………. 43,067 43,104 43,166 43,221 43,274 43,308 34
Medium (50-499)………. 35,889 35,915 35,943 35,956 35,972 35,964 -8
Large (> 499)………….. 15,051 15,041 15,032 15,028 15,023 14,994 -29
Addendum:
Manufacturing……………… 13,789 13,748 13,690 13,663 13,636 13,592 -44
p = preliminary
Seasonally Adjusted
Industry / Size of Payroll
The matched sample used to develop the ADP National Employment Report was derived
from ADP data which, during the first six months of 2008, averaged approximately
399,000 payrolls representing nearly 24 million U.S. employees. This approximately
represents the size of the matched sample used this month.
For information on the construction and use of the ADP Report, please visit the
methodology section of the ADP National Employment Report website at
http://ADPemploymentreport.com/methodology.aspx
Chart 1. Growth of Nonfarm Private Employment, All Industries
-1.0
-0.8
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
Jan-01
Apr-01
Jul-01
Oct-01
Jan-02
Apr-02
Jul-02
Oct-02
Jan-03
Apr-03
Jul-03
Oct-03
Jan-04
Apr-04
Jul-04
Oct-04
Jan-05
Apr-05
Jul-05
Oct-05
Jan-06
Apr-06
Jul-06
Oct-06
Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Source: Automatic Data Processing, Inc., Macroeconomic Advisers, LLC., Bureau of Labor Statistics
Monthly Percent Change, Seasonally Adjusted
Recession ADP National Employment Report BLS Current Estimate
Simple Correlation = 0.86
Chart 2. Growth of Nonfarm Private Employment, Goods-Producing Industries
-1.0
-0.8
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
Jan-01
Apr-01
Jul-01
Oct-01
Jan-02
Apr-02
Jul-02
Oct-02
Jan-03
Apr-03
Jul-03
Oct-03
Jan-04
Apr-04
Jul-04
Oct-04
Jan-05
Apr-05
Jul-05
Oct-05
Jan-06
Apr-06
Jul-06
Oct-06
Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Source: Automatic Data Processing, Inc., Macroeconomic Advisers, LLC., Bureau of Labor Statistics
Monthly Percent Change, Seasonally Adjusted
Recession ADP National Employment Report BLS Current Estimate
Simple Correlation = 0.85
Chart 3. Growth of Nonfarm Private Employment, Service-Providing Industries
-1.0
-0.8
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
Jan-01
Apr-01
Jul-01
Oct-01
Jan-02
Apr-02
Jul-02
Oct-02
Jan-03
Apr-03
Jul-03
Oct-03
Jan-04
Apr-04
Jul-04
Oct-04
Jan-05
Apr-05
Jul-05
Oct-05
Jan-06
Apr-06
Jul-06
Oct-06
Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Source: Automatic Data Processing, Inc., Macroeconomic Advisers, LLC., Bureau of Labor Statistics
Monthly Percent Change, Seasonally Adjusted
Recession ADP National Employment Report BLS Current Estimate
Simple Correlation = 0.78
Chart 4. Growth of Nonfarm Private Employment, by Size of Payroll
-1.0
-0.8
-0.6
-0.4
-0.2
0.0
0.2
0.4
0.6
Jan-01
Apr-01
Jul-01
Oct-01
Jan-02
Apr-02
Jul-02
Oct-02
Jan-03
Apr-03
Jul-03
Oct-03
Jan-04
Apr-04
Jul-04
Oct-04
Jan-05
Apr-05
Jul-05
Oct-05
Jan-06
Apr-06
Jul-06
Oct-06
Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Source: Automatic Data Processing, Inc., Macroeconomic Advisers, LLC.
Monthly Percent Change, Seasonally Adjusted
Recession Small Medium Large
Chart 5. Monthly Changes of Employment in Construction and Financial Activities
-40
-30
-20
-10
0
10
20
30
40
50
Jan.03 Jul.03 Jan.04 Jul.04 Jan.05 Jul.05 Jan.06 Jul.06 Jan.07 Jul.07 Jan.08
Thousands
Construction
Financial
Activities

Empirical analysis performed by Macroeconomic Advisers suggests that the ADP
National Employment Report can be used to develop a forecast of “true” employment that
is superior to those resulting from consensus estimates, survey data, or other models of
employment that do not incorporate the results of the ADP Report.