Payroll Revisions in the Fifth District
Every month the Bureau of Labor Statistics (BLS) surveys over 100,000 businesses and government agencies to create estimates of payroll employment across the United States, including estimates for states and metropolitan areas. Because these surveys only cover a sample of all businesses, they are not perfect estimates of employment.
To correct for errors and ensure accurate measures of employment, these estimates are revised by the BLS at the beginning of each year. The revision process incorporates changes to seasonal adjustments and benchmarks employment to data from the Quarterly Census of Employment and Wages (QCEW) that were not available when initial estimates were published. (For more information on the revision process, see this article.)
The revised employment data show fewer jobs were added in the Fifth District than originally reported. In fact, total employment estimates were revised downward for every month in 2016 and 2017, and by December 2017 (the most recent month revised), total employment was revised lower by 75,300 jobs or 0.5 percent. (See chart below.)
The largest revision for the Fifth District, both as a number and percent, occurred in September 2017, with a downward revision of 92,500 (0.6 percent). As shown in the chart above, there were revisions to employment going further back in time, but they were quite small compared to the changes in late 2017.
When looking at the changes by state, we can see where the largest revisions occurred. In December 2017, total employment in Maryland was revised down by over 46,000 jobs (1.7 percent), which accounted for more than 60 percent of the downward revision in the Fifth District. Aside from West Virginia, which was revised upward by 500 jobs, all of the other states in the Fifth District were revised downward as well.
In the Fifth District as a whole, employment in the professional and business services industry was revised down by 37,200 jobs in December 2017, while education and health and health services employment was revised lower by 43,000 jobs. Starting in the second quarter of 2017, the downward revisions to professional and business services and education and health services became significantly larger than the net upward revisions to all other industries, leading to the downward revisions in total employment. (See chart below.)
The total downward revision to professional and business services in the Fifth District was mainly driven by large downward revisions in Maryland and North Carolina, where employment in December was lowered by 16,400 jobs and 23,500 jobs, respectively. Employment in the same industry in South Carolina and the District of Columbia was also revised down in December. Meanwhile, professional and business employment in Virginia and West Virginia was revised slightly higher.
The revisions to education and health services were negative across all Fifth District states in December, with the largest revisions coming in Virginia (23,600 jobs) and Maryland (8,200 jobs). The remaining states had smaller revisions, ranging from 1,400 jobs in the District of Columbia to 3,800 jobs in South Carolina.
Have a question or comment about this article? We'd love to hear from you!
Views expressed are those of the authors and do not necessarily reflect those of the Federal Reserve Bank of Richmond or the Federal Reserve System.
