June 5, 2008

What If ADP’s Employment Report is Right (and Uncle Sam’s Isn’t)?

Specifically, what if it is better at picking up small-business job creation than the government’s Bureau of Labor Statistics (BLS)?

The media isn’t asking this question, even though the two reports have diverged by over 400,000 jobs in the past four months (see latest reports here, here, and here on ADP’s May estimate that 40,000 jobs were added, vs. expectations that it would come in at 30,000 jobs lost — a 70,000 job difference).

So I will.

The differences between business outsourcing behemoth ADP’s National Employment Report and BLS’s Employment Situation Report have been significant since ADP began issuing theirs in roughly April 2006. The report’s preparers, Macroeconomic Advisers, revised the report’s methodology in February 2007.

Since its initial issuance, ADP and BLS have typically differed sharply. It has been easy to chalk this up to the fact that BLS has been at it for decades, while ADP’s effort is new and untested. Perhaps too easy.

ADP’s methodology begins with the payroll data it processes — roughly 1 in 6 employees in the US have their payroll processed by the company. It is also, according to the company, “based on a historical analysis of over 5 years of payroll data and a monthly review of payroll records.”

The government gets to its number of jobs added or lost in any particular month as follows:

Each month State agencies cooperate with BLS, as well as BLS Data Collection Centers, to collect data on employment, hours, and earnings from a sample of about 160,000 businesses and government agencies, which cover approximately 390,000 individual worksites drawn from a sampling frame of over 8 million Unemployment Insurance tax accounts. The active CES sample includes approximately one-third of all nonfarm payroll workers. Sample respondents extract the requested data from their payroll records, which must be maintained for a variety of tax and accounting purposes. Data are collected by telephone, touch-tone self response, computer-assisted interviews, fax technology, voice recognition, and mail. The use of electronic media results in more rapid response times and higher response rates. States also electronically transmit both sample data and geographic estimates to BLS in Washington to speed the estimation and publication processes.

It seems to me that ADP’s methodology has the potential, if done properly, to get closer to being right than the government’s. It should especially be able to pick up changes in small-business employment more quickly.

Here are the differences between the two reports through the first four months of 2008 for private nonfarm payrolls, seasonally adjusted:

ADPvBLSfor1st4MosOf2008

ADP shows 117,000 jobs added; BLS shows 312,000 lost. What’s more, the net difference of 429,000 is not far from the sum of job gains by small and medium-sized companies in the service sector, plus the difference between the ADP and BLS in manufacturing jobs lost.

Unfortunately, ADP does not make non-seasonally-adjusted data available, though I have inquired to see if they might consider it. That data, when compared to BLS’s unadjusted numbers, would probably be more valuable. but we’ll work with what’s available.

My theories:

  • ADP is picking up service-sector payroll increases at both new and existing small- and medium-sized service-sector companies more quickly.
  • In manufacturing (a subset of “Goods-producing”), the government is better at quickly picking up job losses, especially big ones, thanks to mass-layoff requirements, than it is typically small individual-employer job gains. ADP’s feedback, based as it is on paychecks actually issued, is more immediate, especially at small companies.

The wild card in all of this is whether ADP has adjusted appropriately for possible differences in the makeup of its client base vs. all employers in the economy when it projects from its in-house payroll data. If they are getting it right, the BLS will have a lot of jobs to add in the coming months — or, if not then, BLS will have to add them in its Comprehensive Annual Revision.

By the way, the BLS’s Comprehensive Annual Revisions in two of the past three years have been huge, so it’s not like anyone, including the recession-obsessed media, can pretend that their problem with picking up new jobs doesn’t exist.

In February 2007′s revision, BLS “found” over 900,000 jobs. The previous year, according to the New York Times, the revision was over 400,000 “found” jobs.

It also happens that a modest increase in total employment so far this year would be consistent with other economic reports we’ve seen, particularly tepid but positive GDP growth, Institute for Supply Management Reports showing overall expansion, decent Orders reports from the Census Bureau, and others.

Regardless of how close the BLS is to ADP’s report tomorrow, “someone” should be digging into this more deeply. Why aren’t they? I’ll suggest that it may partially be because the business press is comfortable in their “of course we’re in a recession” mindset, and the answer to the question I’ve raised here would rock their world.

Cross-posted at NewsBusters.org.

Latest Pajamas Media Column (‘$8 Gas a Good Thing? I Don’t Think So’) Is Up

It’s here.

They did a nice job on the tease, too — “Believe it or not, some people out there actually believe that soaring gas prices are a blessing. Time for them to ‘fill up’ on common sense.”

I will post the column here at BizzyBlog Saturday afternoon (link won’t work until then) under the title “$8 Gas a Good Thing? I Don’t Think So” after the blackout expires.

Sorry, Jeff Coryell — Vic’s Malariotherapy Adventure Is Still a Dealbreaker

Nice try, Jeff, no sale — The validity, or lack thereof, of the complaint to the Ohio’s State Medical Board doesn’t change the validity of conclusions reached in 2006.

First, an important assertion made by the Dean of Cincinnati remains unrefuted, unless someone proves otherwise. Thus, his conclusion still stands:

She told one reporter that she did not find “Malariotherapy” effective, yet in her report to the Heimlich Institute she laid out plans to rename it, promote it, and do further research on it.

….. Dr. Wulsin now seeks the office of congresswoman, representing the citizens of Ohio. While we all can make small errors of judgment and may disagree from time to time, Wulsin’s activities at the Heimlich Institute go beyond simple mistakes. She knew exactly what she was doing, worked for a period of months, had access to records and resources, and was paid for it. How she was paid should be the subject of further investigation. In my opinion, her failure to stop the “Malariotherapy” by exposing it is reprehensible. If she claims she didn’t know then she is inept.

My pre-election take in 2006 also still stands:

Folks, the CDC and others rightly believe that this kind of human experimentation needs to be relegated to the House of Horrors — not given at least tacit sanction, as it was, by an MD who at some point may have been on the take.

As a congressperson in a technically advanced age, Vic Wulsin will be in a position to not only vote on legislation authorizing “advances” in medical science that are questionably ethical, but she will be able to throw the persuasive weight of her medical credentials behind any effort to do so.

(Now, pay attention closely here, because deciding that Vic Wulsin’s ethical breaches constitute a Dealbreaker has NOTHING to do with whether you, dear reader, are prolife, but they have EVERYTHING to do with whether Vic Wulsin is prolife.)

All of this aside, Vic Wulsin could have a failsafe position in all of this if she were unequivocally prolife. Her past dalliance with Dr. Heimlich could be excused as a big, but not fatal, mistake, as she had no hands-on involvement in experiments. She could in theory, say she’s sorry and promise to sin no more. But Vic Wulsin is anything but prolife, and is in fact pro-abort, pro-embryonic stem cell research, and perhaps even pro-cloning (she refused to answer a Cincinnati Right to Life questionnaire which could have cleared up these matters). This means that there is no reason — none — to believe that she would be willing to put the moral brakes on allowing taxpayer dollars to be used for “promising” but unethical medical studies and protocols that might be stampeded though Congress in the name of “the greater good,” or to make such studies a law-enforcement matter if they were attempted in the private sector.

Based on all of the above, Vic Wulsin has earned BizzyBlog Dealbreaker 1: Serious Lapses in Medical Ethics.

(Recall that a BizzyBlog Dealbreaker is “something that completely justifies a person not voting for you, regardless of your party or your stands on the issues.”)

What the state Ethics Board did or didn’t do changes none of this.

If 2nd District voters knew of Vic’s Malariotherapy Adventures, the vast majority would immediately see her as totally out of touch with their values. Wulsin’s only hope is that, with the silent assistance of the Cincinnati Enquirer, they never find out.

__________________________________

Source Material:

  • Oct. 20 — (Cincinnati Beacon, guest column by Dr. Robert Baratz) Black Box Warning: Wulsin’s Claims of Innocence
  • Various Dates — (Cincinnati Beacon) Wiki entry for Victoria Wulsin
  • A PDF of Wulsin’s report with Executive Summary is no longer available at the link where it was present in November 2006.

Things I’d Like to Post About Today ….. (060508)

Filed under: TILTpatBIDHAT — Tom @ 9:58 am

….. But I Don’t Have Any Time For:

  • Olbermann Watch reports on the MSNBC host’s ongoing problems with paying his taxes on time. Keith can commiserate with Al “$70,000 in Back Taxes to 17 States” Franken.
  • Justin at Right on the Right nails the irony resulting from the 5 months of agony otherwise known as the Democrat Party’s nominating process — “Selected, Not Elected.”
  • I’d like it to be stronger than “on the brink of defeat,” but the UK Telegraph says (HT Hot Air) that British troops in Afghanistan have beaten the Taliban to that point in Afghanistan.
  • An actuary with an undisclosed payment arrangement with government labor unions has apparently committed New York City to about $60 million a year in future costs because of bills passed by the State Legislature that were supposedly cost-neutral (HT Megan McArdle via Instapundit).
  • Here’s a great Veep candidate John McCain will never pick — Oklahoma Senator James Imhofe (“We Don’t Need a Climate Tax on the Poor”; HT Captain Ed at Hot Air). Related reminder: “UAH: Global Temperature Dives in May” (HT to a CCnet e-mail).

Couldn’t Help But Comment (060508, Morning)

What is it with WorldNetDaily’s Aaron Klein (And His WND Bosses)?

Debbie Schlussel reports that Klein has again lifted her work “almost word-for-word,” and presented it as an “exclusive,” which in WNDLand appears to mean, in essence, “anything we haven’t reported on before.” I’ll let readers decide whether it’s worth fishing around WND to find what I’m referring to; I’m in no mood to link.

This follows Klein performing similar tricks on yours truly back in March (BlumerNetDaily – Part 1; Part 2). Then Klein made it appear as if WND was solely responsible for the Barack Obama campaign’s quiet repudiation (also first noted at BizzyBlog) of sentiments expressed in a Hamas leader’s column printed in the Trinity United Church of Christ’s church bulletin — three days after yours truly first broke the news, and well after Michelle Malkin and Charles at Little Green Footballs referred to my post (with proper attribution in each instance).

As what I see as link-hogging, credit-grabbing, and material-lifting at WND apparently continues unabated, I’ll just have to repeat my opinion expressed in March:

All of this is very pathetic. There was a time in the late 1990s when it appeared that WND might become one of the leading lights of New Media. Instead, in its current construction, WND is a sad monument to lost potential.

Update: So WND gets all the link benefit of Taranto’s coverage yesterday at Best of the Web, based on work originally done by Debbie Schlussel. Mission accomplished, eh Aaron?

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Let’s see how much coverage, especial on TV, this story receives:

US Marine acquitted of all charges in Haditha killings

A court martial on Wednesday acquitted a US Marine for his role in the deaths of 24 civilians in Haditha in Iraq in 2005, the sixth man to be exonerated in the affair, a military official said.
Lieutenant Andrew Grayson, 27, was declared “not guilty on all charges” by a jury, said a spokesman for the Camp Pendleton military base in southern California where the hearing started on May 28.

Grayson had been charged with making false statements and attempting to fraudulently separate from the Marine Corps. He was also charged with obstruction of justice, but the military judge dismissed this charge Tuesday.

He was the first Marine to stand trial in connection with the killings of 24 men, women and children in Haditha, the most serious war crime allegations leveled at US forces since the 2003 invasion to topple Saddam Hussein.

Is Jack Murtha, the congressman who, as Michelle Malkin noted two years ago, opted for “verdict first, trial later” on national TV, available for comment yet? Better yet, should he not be censured, or worse, by Congress?

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ADP’s National Employment Report on Wednesday said that 40,000 seasonally adjusted nonfarm private jobs were added in May, and revised its April figure of +10,000 to +13,000.

This may be a harbinger of a positive jobs number in the government’s Employment Situation report tomorrow, as well as upward revisions to prior months (crossing fingers). The government came in with a -20,000 change in seasonally adjusted jobs in April, which was 30,000 below ADP’s original figure. A repeat of that 30,000-job gap tomorrow would bring the government’s May number into positive territory.

I hope to have more to say on the ADP report, which may deserve more respect than it has been getting, later today.

Positivity: Woman Wakes After Heart Stopped, Rigor Mortis Set In

Filed under: Positivity — Tom @ 5:59 am

From West Virginia (video is also at link):

Friday, May 23, 2008

Val Thomas’ doctors honestly can’t explain how she is alive today.

Thomas, who lives in West Virginia, is being called a medical miracle after she suffered two heart attacks and had no brain waves for more than 17 hours; reports NewsNet5.com.

Thomas’ heart stopped around 1:30 a.m. Saturday and doctors said she had no pulse. Rigor mortis started to set in, and she was placed on a respiratory machine.

“Her skin had already started to harden and her fingers curled,” Thomas’ son, Jim, told NewsNet5.com. “Death had set in.”

Thomas, 59, was rushed to a West Virginia hospital, where she was put on a special machine to induce hypothermia. This would allow her body to cool down for 24 hours before they would warm her up again, doctors explained.

However, Thomas’ heart stopped again after the procedure.

Her family said their goodbyes and Thomas’ tubes were removed, but she remained hooked on a ventilator as the possibility of organ donation was discussed.

However, Thomas woke up 10 minutes later and started talking.

“The nurse said, ‘I’m so sorry, Mrs. Thomas,’ and mom said, ‘That’s OK, honey, that’s OK,’” Jim Thomas said. …..

Go here for the rest of the story.