Payroll processor ADP cut the number of private-sector payrolls added in its September employment report to 88,200 from 162,000 thanks to new methodology, CNBC reports.
ADP has partnered with Moody’s Analytics to produce the data, and the alliance changes the way the firm calculates the number of nonfarm payrolls the private sector creates or erases each month.
The ADP report is seen as a forerunner for the official monthly jobs report released by the Bureau of Labor Statistics normally just one day afterward.
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Official government data revealed the economy picked up a net 114,000 nonfarm payrolls in September, which would outpace the revised ADP figures.
ADP executives say they are looking forward to using the new methodology.
“Our new strategic collaboration with Moody’s Analytics marks the beginning of an exciting stage in the evolution of the ADP National Employment Report, as we work to offer an even deeper, richer and more illuminating look at U.S. monthly employment,” Jan Siegmund, chief strategy officer at ADP, said in a statement.
“Moody’s Analytics is one of the most trusted names in economic forecasting with a vast and dedicated research team focused on national and regional U.S. employment trends. This team is led by their Chief Economist Mark Zandi, one of the world’s most respected labor market experts. We look forward to working closely with the Moody’s Analytics team to provide an insightful analysis of the changes in the U.S. labor market.”
The U.S. official jobs report is one of the most closely watched economic indicators in the world’s largest economy.
While the country continues to grow, albeit sluggishly from the worst downturn since the Great Depression, and even though inflation rates remain under control, unemployment rates remain high and are often cited as the chief concern among voters this election year.
Superstorm Sandy, which morphed from a hurricane to a post-tropical monster that pummeled the Northeast earlier this week, closed markets for two days and might have seriously disrupted commerce.
But the October jobs report will be released on Nov. 2 as planned.
A Bloomberg survey of economists pegs payrolls rising by 125,000 in October, which would bring the headline unemployment rate to 7.9 percent from a three-year low of 7.8 percent reached in September.
European uncertainty and a fast-approaching fiscal cliff are prompting businesses to put off expanding and hiring.
At the end of this year, tax cuts are scheduled to expire at the same time automatic cuts to government spending kick in, a combination known as a fiscal cliff that could send the economy sliding into a recession if left unchecked by Congress.
“Consumers are spending, but businesses are cautious about hiring because there is a lot of uncertainty related to the election, the fiscal cliff and regulations,” said Sung Won Sohn, an economics professor at California State University Channel Islands in Camarillo, Calif., according to Reuters.
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