Sunday, January 30, 2011

BLS Employment Revisions on Feb 4th

by Bill McBride on 1/30/2011 02:05:00 PM

Earlier:
Summary for Week ending January 29th
Schedule for Week of January 30th

On Feb 4th, with the release of the January employment report, the BLS will make the following three changes / revisions:

1) Annual Benchmark revision to the Establishment Survey Data

With the release of January 2011 data on February 4, 2011, the Current Employment Statistics survey will introduce revisions to nonfarm payroll employment, hours, and earnings data to reflect the annual benchmark adjustments for March 2010 and updated seasonal adjustment factors. Not seasonally adjusted data beginning with April 2009 and seasonally adjusted data beginning with January 2006 are subject to revision.
Last October the BLS released the preliminary annual benchmark revision of minus 366,000 payroll jobs. Usually the preliminary estimate is pretty close to the final benchmark estimate.

Percent Job Losses During RecessionsClick on graph for larger image in graph gallery.

This graph shows the impact of the preliminary benchmark revision on job losses in percentage terms from the start of the employment recession.

The red line on the graph is the current payroll estimate, and the dotted line shows the impact using the preliminary benchmark estimate. This means that payroll employment in March 2010 was 366,000 lower than originally estimated (using the preliminary estimate). The number is then "wedged back" to the previous revision (March 2009). This is slightly larger than a normal adjustment (see table in the post from last October).

2) Birth/death adjustment factors will be estimated on a quarterly basis
Effective with the release of January 2011 data on February 4, 2011, the establishment survey will begin estimating net business birth/death adjustment factors on a quarterly basis, replacing the current practice of estimating the factors annually. This will allow the establishment survey to incorporate information from the Quarterly Census of Employment and Wages into the birth/death adjustment factors as soon as it becomes available and thereby improve the factors. Additional information on this change is available at www.bls.gov/ces/ces_quarterly_birthdeath.pdf.
This should improve the accuracy of the model at turning points.

3) Changes in Population Controls for Household Survey
Effective with the release of data for January 2011 on February 4, 2011, revisions will be introduced into the population controls for the household survey. These changes reflect the routine annual updating of intercensal population estimates by the U.S. Census Bureau.

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