Jobs

I can't say I'm surprised by the employment numbers: payroll employment up 103,000 in December. Despite the strong ADP report on Wednesday, I couldn't get my statistical model to give me anything more than 130,000 or so. On the other hand, according to the household survey employment rose by 297,000, which is exactly the number that ADP had for private sector employment gains.

The big drop in the unemployment rate (from 9.8% to 9.4%) is not entirely good news - some of it is due to the increase in employment, but the labor force fell by 260,000 as well.

So we continue to wait for the breakout in employment while wondering how ADP could so overstate the BLS number after understating it all year. Clearly there's something goofy going on with the data right now and we may not have a good idea of where the economy really stands until we see the next couple of years' worth of revisions.