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I recall that we've seen this on several occasions:  ADP makes a splashy headline that gets my hopes up, and then the Dept. of Labor Statistics deflates them a few days later.

What gives?

I ask this in all seriousness.   I'm hoping that some of the more economically/statistically informed people who frequent DKos will explain.  

If ADP says that 201,000 private sector jobs were added in August, shouldn't they know?  After all they process payrolls for a large swath of private sector companies.  Is that swath not a representative sample of the sector?

Or are we losing more public sector jobs and that's offsetting the bump in private sector job growth?  

I have a relatively high comfort level with most cognitive dissonance, but this is starting to irk me.  

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Comment Preferences

  •  ADP takes care of (5+ / 0-)

    I think one out of every six payroll checks. So what they are doing is extrapolating out their increases in payroll and it doesn't seem to be a very good model.

    However they were only off by 100K since 103K private sector jobs were created:) We get to the 96K by subtracting the 7000 public sector employees that were laid off, probably in red states.

    Republican Family Values: Using the daughters from your first wife to convince everybody that your second wife is lying about your third wife.

    by jsfox on Fri Sep 07, 2012 at 09:31:04 AM PDT

  •  According to this article from 2010.. (3+ / 0-)

    http://www.marketoracle.co.uk/...

    Inquiring minds may be interested in seeing a comparison between ADP and the BLS (government) reports.

    A direct number to number comparison using the standard BLS report is inaccurate because ADP reports private nonfarm jobs while the BLS reports all nonfarm jobs. The latter is tremendously skewed this year by census hiring and firing. It is also skewed by normal government hiring and firing.

    "And there are those who give and know not pain in giving, nor do they seek joy, nor give with mindfulness of virtue; They give as in yonder valley the myrtle breathes its fragrance into space" Khalil Gibran

    by bcdelta on Fri Sep 07, 2012 at 09:33:15 AM PDT

  •  The best advice I can offer is don't get your (1+ / 0-)

    hopes up with unofficial numbers.  Take them with a grain of salt, hope they are right or understate the real figure, but don't get a high because they put a number up that looks good.

    So now we have had 30 months of continuous job growth, and that's the real good news.

    Another bit of good news is that the Romney campaign sees poor job growth numbers as good for them.  Think about that for a minute.  They celebrate and revel in bad economic news because of their misguided thought that suffering increases their chance for election.  Then be repulsed.

    Republicans are like alligators. All mouth and no ears.

    by Ohiodem1 on Fri Sep 07, 2012 at 10:11:35 AM PDT

  •  Was wondering that too. (1+ / 0-)
    Recommended by:
    Nowhere Man

    But watch this clip, from the Canadian business channel, BNN.  It's an interview with economist John Lonski, and around the 2:30 mark they discuss the ADP vs DLS discrepancies.

    http://watch.bnn.ca/...

    (Sorry I don't know how to embed videos.)

    It's interesting that Lonski says, and I quote, that the ADP report "might actually prove to be more accurate than the US government survey..." and that "there might be some employers that want to get rid of Obama that have this bias to underestimate their payrolls..."

    Interesting.  Make of this what you wish.

  •  Interesting clip, bishanite. (0+ / 0-)

    One of the interesting things it pointed out is that BLS includes a different field of jobs than ADP, the latter being all private, and the former being a mix, not a statistically constructed one in the way a poll is but rather simply a list of those who got the survey and answered, and including all those government layoffs as well. Two entirely different fields of data. And I did notice this morning references to the BLS being manufacturing jobs, not all jobs, the commentators dropping from one to the other,  so I cannot tell if the number from BLS is all private job sources or just the mfg, and the ADP report listed mfg and service separately, with a large growth in service jobs. So the numbers are not comparable, and the BLS one not necessarily more accurate.  This is what I get from reading all the diaries on DKos about watching the methodology about how numbers are put together. Gold star for DKos.  

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