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Nonfarm Payroll

Contents

  1. Deciphering Nonfarm Payrolls: Understanding the Basics
  2. Exploring Nonfarm Payrolls
  3. Understanding Nonfarm Payrolls
  4. Analyzing the Monthly Report
  5. Household Survey
  6. Establishment Survey
  7. Economic Analysis
  8. Fact Check:

Deciphering Nonfarm Payrolls: Understanding the Basics

Exploring Nonfarm Payrolls

Nonfarm payrolls, a crucial economic indicator, measure the total number of workers in the United States excluding farm workers and certain other job categories. Compiled by the Bureau of Labor Statistics (BLS), this data is released monthly in the "Employment Situation" report, offering insights into the health of the labor market.

Understanding Nonfarm Payrolls

While the term implies the exclusion of farm workers, nonfarm payrolls also omit several other categories. Approximately 80% of U.S. business sectors contributing to GDP are included in nonfarm payroll data, yet notable exclusions extend beyond farm workers to encompass government employees, private household workers, proprietors, and non-profit staff.

Analyzing the Monthly Report

The "Employment Situation" report, released on the first Friday of each month by the BLS, combines data from two surveys: the Household Survey and the Establishment Survey. While the Household Survey furnishes unemployment rate details and employment demographics, the Establishment Survey, also known as the nonfarm payrolls report, provides information on new nonfarm payroll jobs added nationwide.

Household Survey

Components of the Household Survey include unemployment rates by various demographics, participation rates, and reasons for unemployment.

Establishment Survey

The Establishment Survey offers insights into total nonfarm payrolls added, payroll additions by industry, hours worked, and average hourly earnings.

Economic Analysis

Economists and policymakers utilize nonfarm payroll data to assess the economy's current state and forecast future activity. Insights from the report impact various sectors, including the stock market, currency values, and commodity prices.

Fact Check:

  • Historically, May records the highest average wage growth, while August tends to be the lowest.
  • The best year for nonfarm payroll growth was 1994, with 3.85 million jobs added, while 2009 marked the worst year, with a loss of 5.05 million jobs.