7:45am

Thu January 5, 2012
The Two-Way

Strong Gain: Employers Added 325,000 Jobs Last Month, Survey Says

There was a 325,000-gain in the number of jobs on private employers' payrolls last month, according to the widely watched ADP National Employment Report, which was just released.

That's the largest monthly increase in the ADP employment measure since December 2010 and suggests, economist Joel Prakken of Macroeconomic Advisers says in a statement released by ADP, that the nation's unemployment rate likely declined further last month. The figure is seasonally adjusted (more on that below).

In November, the unemployment rate dipped to 8.6 percent from 9 percent the month before.

We'll get the official word on December's rate Friday morning, from the Bureau of Labor Statistics. In recent months the BLS figures, based on surveys of employers, have shown slower job growth than ADP's, which are based on information gleaned from the 500,000 payrolls (covering 24 million workers) that the company processes (more on ADP's report below).

There's more hopeful news on employment this morning:

-- The number of Americans filing first-time claims for jobless benefits declined by 15,000 last week, to 372,000, according to the Employment and Training Administration. That's the fourth decline in five weeks and the four-week average, which economists watch to gauge the underlying trend, dropped to its lowest level since June 2008: 373,250.

-- The outplacement firm Challenger, Gray & Christmas says "planned job cuts announced by U.S. employers declined in December to 41,785, the lowest monthly total since June."

Bloomberg News says "U.S. stock-index futures pared losses" after the ADP report was released.

The Wall Street Journal's Real Time Economics blog, though, cautions that ADP's numbers "may be inflated by seasonal issues." And it notes that ADP's estimate has recently tended to be larger than the official number from the government.

Update at 10:15 a.m. ET. More On The ADP Report:

-- Bloomberg News says ADP's reports on employment in the month of December can be particularly difficult to "seasonally adjust" because at the end of each year many employers officially remove from their payrolls some workers who were laid off or fired earlier in the year. To smooth out the seasonal effect and get at the underlying trend, the economists who crunch ADP's numbers make some assumptions about the size of that "purge." If they miscalculate, they could be off on the overall change.

-- "In the latest round of data, ADP may have expected a bigger purge than actually occurred, skewing its final headline figure to the upside," says TheStreet.com.

Copyright 2012 National Public Radio. To see more, visit http://www.npr.org/.