Affiliations: Federal Reserve Bank of Dallas, Dallas, TX, USA
Correspondence:
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Corresponding author: Keith R. Phillips, Federal Reserve Bank of Dallas, Dallas, TX, USA. Tel.: +1 210 978 1409: E-mail: keith.r.phillips@dal.frb.org.
Note: [1] We thank Carl Bonham and the participants at the session on forecasting regional economies at the 91st Annual Conference of the Western Economic Association International, June 30, 2016 in Portland, Oregon for helpful comments. The views expressed are those of the authors and do not necessarily reflect those of the Federal Reserve Bank of Dallas or the Board of Governors of the Federal Reserve System. Any remaining errors are our own.
Abstract: Data from large payroll processing companies are a potential source of regional job growth estimates that are timelier than official government statistics. Monthly private sector employment data from ADP, LLC is available for 29 U.S. states and Washington DC about 10 days prior to official employment data from the U.S. Bureau of Labor Statistics. Using a simple model with real-time data, lags of job growth and the coincident month ADP estimates, we find that for all 30 regions the information in the ADP is statistically significant in nowcasting the most recent month of job growth. Our results suggest that the ADP data are an important source of information for analysts conducting regional current analysis.
