ADP Beats As Small Businesses Respond To Payroll Tax Cash Crunch By Hiring More
While the ADP private payroll monthly update (certainly before its wholesale revision every year or so to make it more accurate in retrospect) has traditionally been completely worthless in its predictive ability of the NFP number it precedes by two days, today it was the only source of US economic update, and as such everyone - certainly the handful of algos that trade stocks - at least pretended to pay attention when ADP reported the best private payrolls number since February 2012 (unrevised), printing at 198K, well above expectations of a decline to 170K from 192K in January. This was the fifth beat in a row, and the fifth beat since Moody's Mark Zandi starting making up the numbers in the ADP report. Additionally, the January number was revised higher to 215K. Why? Because defying all logic, it was small businesses which drove the surge in job creation in February, the month when gas prices soared to an all time high and when spending was curtailed due to impact of the payroll tax cut, at least according to such irrelevant indicators as Wal-Mart retail traffic, by creating some 77K jobs, more than either middle or large business. Realistic? Of course not. Does anyone care? Absolutely not: after all it simply allows the "head in the sand" trading style to continue indefinitely.
This joke of a release, which doesn't even provide the non-seasonally adjusted data, really requires no more commentary. Here are some of the pretty charts added in the release:
Change in Nonfarm Private Employment (in thousands)
Historical Trend - Change in Total Nonfarm Private Employment (in thousands)
Total Nonfarm Private Employment by Company Size (in thousands)
Change in Total Nonfarm Private Employment by Selected Industry (in thousands)
And, keeping it real, here is the social network friendly infographic that ADP attaches to its monthly update. Cause they too have to keep it hip.
- advertisements -