ADP is out with its monthly jobs report and this can still move the market. The problem is that the data can be opposite of the truth or just off the mark. Last month’s gains from ADP versus the miniscule “real” gains reported by the Labor Department was so far off the mark that ADP could have stood for “Another Dopey Prediction.”
The July figure from ADP is showing a gain of up 114,000. The consensus estimate from Bloomberg was only 86,000. This is far higher than what the broader economic readings have been signaling and frankly it feels suspect.
June was revised lower to 145,000 from 157,000 but they were so far off the mark that this revision might just be another embarrassment.
Part of the problem is that ADP is a sub-set and does not cover all segments nor all businesses. Bloomberg notes each month that the ADP data reflects approximately 400,000 U.S. business clients that cover roughly 24 million U.S. employees in all private industrial sectors.
As far as how this compares to the Labor Department estimates for Friday, that data is as follows: creation of jobs in non-Farm Payrolls, Bloomberg is expecting a consensus reading of 75,000 new jobs in July versus a preliminary figure of 18,000 in June. The private payrolls data is expected to be about 100,000 and the unemployment rate is expected to be flat at 9.2%.
JON C. OGG
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