Summary
ADP, a company that processes payrolls, recently stopped giving the Federal Reserve access to its employment data. This has highlighted the importance of government-produced economic data in understanding the economy. With government data temporarily halted due to a shutdown, the reliance on private data sources is evident, but they come with limitations.
Key Facts
- ADP stopped sharing private-sector payroll data with the Federal Reserve.
- The Federal Reserve used ADP's data for detailed insights into employment trends.
- ADP's decision could be linked to concerns about client relationships or business costs.
- The government shutdown has limited access to official employment data.
- Private companies like ADP, Bank of America, Visa, and Mastercard offer data but have their own business priorities.
- Private data is often more timely but not as comprehensive as government data.
- ADP manages payroll for about 20% of the private sector, making its data significant yet not fully representative of the entire economy.
- Federal Reserve officials use a variety of data sources to understand economic conditions.
