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Analysis of October's ReportPrint the PDF Version of the ADP Report Wednesday, October 31, 2007, 8:15 am EDT Nonfarm private employment grew 106,000 from September to October of 2007 on a seasonally adjusted basis, according to the ADP National Employment Report®. The estimated change in employment from August to September was revised up 3,000 to 61,000. October's increase of 106,000 marked an acceleration of private nonfarm employment after three months (July through September) during which the average monthly change was just 43,000. In October, employment in the service-providing sector of the economy grew a healthy 134,000. Employment in the goods-producing sector declined 28,000, the eleventh consecutive monthly decline. Employment in the manufacturing sector fell 14,000. Small- and medium-size businesses more than accounted for the increase in total employment in October, with employment among these businesses advancing by 113,000. In contrast, employment among large businesses fell by 7,000 in October, the fifth consecutive monthly decline. The gains in employment at small- and medium-size businesses were concentrated in the service-providing sector of the economy, and showed a gain of 132,000. However, employment among these same-size businesses in the goods-producing sector fell 19,000. 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. In October, employment in the construction sector fell 16,000 (see chart 5), the thirteenth decline in the last fourteen months, bringing the cumulative decline since August of 2006 to 173,000. In addition, employment in the financial activities sector dropped 1,000 in October, the third consecutive monthly decline after nearly six years of uninterrupted growth (see chart 5). This month's ADP Report includes a comparison of the ADP Report to last month's release of the Bureau of Labor Statistics preliminary estimates of benchmark revisions to the establishment survey through March 2007 (see chart 6). This comparison indicates a downward revision of the establishment survey to a level consistent with the ADP Report for the same time period. 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 .
The matched sample used to develop the ADP National Employment Report was derived from ADP data which, during the first six months of 2007, averaged approximately 383,000 payrolls representing nearly 23 million U.S. employees. This approximately represents the size of the matched sample used this month.
About the ADP National Employment Report ® The ADP National Employment Report, sponsored by ADP®, was developed and is maintained by Macroeconomic Advisers, LLC. It is a measure of employment derived from an anonymous subset of roughly 500,000 U.S. business clients. During the first six months of 2007, this subset represented approximately 383,000 U.S. business clients and nearly 23 million U.S. employees working in all private industrial sectors. The data is collected for pay periods that can be interpolated to include the week of the 12th of each month, and processed with statistical methodologies similar to those used by the U.S. Bureau of Labor Statistics to compute employment from its monthly survey of establishments. Due to this processing, this subset is modified to make it indicative of national employment levels; therefore, the resulting employment changes computed for the ADP National Employment Report are not representative of changes in ADP's total base of U.S. business clients. 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. For a description of the underlying data and the statistical properties of the series, please see "ADP National Employment Report: Development Methodology" at http://ADPemploymentreport.com/methodology.aspx.
For a full schedule of future releases, please visit: www.ADPemploymentreport.com Click to view this month's press release |
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