Is the ADP unemployment report wrong?
Often the Automatic Data Processing (ADP) unemployment figures are publicized by the media. This has been the case recently, where ADP has been quoted:
Non-farm private employment decreased 532,000 from April to May 2009 on a seasonally adjusted basis, according to the ADP National Employment Report®. The estimated change of employment from March to April was revised by 54,000, from a decline of 491,000 to a decline of 545,000.
Monthly employment losses in April and May averaged 539,000. This is a notable improvement over the first three months of the year, when monthly losses averaged 691,000.
According to the June 18, 2009 press release from the Unemployment Insurance Weekly Claims Report for the U.S. Department of Labor, the picture is not so rosy.
The US Department of Labor states:
Nevertheless, despite some recent indications that economic activity is stabilizing, employment in the week ending June 13, the advance figure for seasonally adjusted initial claims was 608,000, an increase of 3,000 from the previous week’s revised figure of 605,000. The 4-week moving average was 615,750, a decrease of 7,000 from the previous week’s revised average of 622,750.
Even the US federal government, which has been expected to offer more jobs, is laying off people at a greater rate, according to the US Department of Labor, “Initial claims for UI benefits by former Federal civilian employees totaled 1,972 in the week ending June 6, an increase of 206 from the prior week. There were 1,874 initial claims by newly discharged veterans, an increase of 419 from the preceding week.”
This demonstrates that the unemployment picture is not showing any signs of improvement, and raises the question of why the US Department of Labor and ADP statistics are so divergent.
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