Both the payroll and household surveys are needed for a complete picture of the labor market. The payroll survey provides a highly reliable gauge of monthly change in nonfarm payroll employment. The household survey provides a broader picture of employment including agriculture and the self-employed.
For research and comparison purposes, BLS creates an “adjusted” household survey employment
series (red line) that is more similar in concept and definition to payroll survey employment. The
adjusted household survey employment series is calculated by subtracting from total employment
agriculture and related employment, nonagricultural self-employed, unpaid family and private
household workers, and workers absent without pay from their jobs, and then adding
nonagricultural wage and salary multiple jobholders. The resulting series is then seasonally
adjusted.
The main differences were created by...
(1) Sampling error - 143K vs. 60K
(2) Payroll survey benchmark revisions - Changing yearly, but somewhat lagged... Current benchmark of payroll data is based on March 2014.
(3) New business births - The payroll survey sample cannot include new firms immediately.
(4) Job Changing - If a person changes jobs and is on the payrolls of two employers during their pay periods that include the 12th of the month, both jobs would be counted in the payroll survey estimates.
Conclusion and Implications
(1) Considering possible error from somewhat old benchmark and excluding new birth jobs and self-employed in payroll data, recent labor market activities could not be disappointed as seasonal adjusted household surveys.
(2) However, seasonal adjustment has own volatility. Not adjusted data showed decline in employees.
(3) Furthermore, for recent 1 year, payroll jobs were more than household surveys'.
(4) Household surveys have own problem of small sampling like ECI data.
(5) So, it's hard to find meaningful implication from this...-_-
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