ADP Employment Report
by Tom on June 3, 2009
in Market Musings
A couple of key things to notice about the ADP report:
- It’s typically more volatile (inaccurate) than the official government one on Friday.
- It shows that the pace of job loss has stabilized. We’re still losing 500,000 jobs a month which is a staggering number when you think about it, but it’s not getting worse.
- The April numbers were revised downward by over 10% from the original reports
- The markets are expecting a similar number (500K) on Friday.
So, what does this mean?
- We aren’t out of the woods on job losses yet.
- But the world isn’t approaching meltdown status like it was early last fall. Its just a really lousy economy.
My expectation is that these reports will have relatively little impact on mortgage rates for two main reasons:
- The markets are more concerned with the government’s borrowings than the economic reports in many ways.
- Reports that come in “in line” with expectations rarely have a substantial impact on the bond market and/or mortgage rates.
Stay tuned, while our rates have been very stable, the underlying volatility is immense.
Tom Vanderwell
Private sector cuts 532,000 jobs in May, ADP says – MarketWatch
WASHINGTON (MarketWatch) – The U.S. private sector eliminated 532,000 net jobs in May, the fewest jobs lost since November, according to the ADP employment index released Wednesday.Goods producing industries cut 267,000 jobs while services cut 265,000.
The index comes two days before the government releases its estimate of May nonfarm payrolls. Economists surveyed by MarketWatch are looking for payrolls to drop by 500,000 in the government survey, which would be the smallest decline since October.
The ADP index does not include government jobs. To get an apples-to-apples comparison with the Labor Department report, you have to add in about 13,000 jobs typically gained in the public sector. That suggests total payrolls fell by about 545,000 in May, compared with the MarketWatch consensus of 500,000 for the Labor Department’s estimate.
The April ADP index was revised to a decline of 545,000 from a decline of 491,000 previously reported.
