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Current Employment Statistics - CES (National)

CES National Benchmark Article (PDF)

BLS Establishment Survey National Estimates Revised to Incorporate March 2020 Benchmarks

Authored by Victoria Battista and Shane Haley.

Victoria Battista and Shane Haley are economists in the Division of Current Employment Statistics – National, Office of Employment and Unemployment Statistics, Bureau of Labor Statistics. Telephone: (202) 691‑6555; email: Contact CES

Summary of the revisions

With the release of January 2021 data on February 5, 2021, the Bureau of Labor Statistics (BLS) introduced its annual revision to national estimates of employment, hours, and earnings from the Current Employment Statistics (CES) monthly survey of nonfarm establishments.

The March 2020 benchmarked seasonally adjusted employment level for total nonfarm employment is 150,840,000. The not seasonally adjusted benchmarked employment level is 149,952,000.

Compared with the sample-based, seasonally adjusted published estimate for March 2020, total nonfarm employment had a revision of −250,000 or −0.2 percent. The not seasonally adjusted total nonfarm employment estimate was revised by −121,000 or −0.1 percent.

Table 1 presents revised total nonfarm employment data on a seasonally adjusted basis for January 2020 through December 2020. The revised data for April 2020 forward incorporate the effect of applying the rate of change measured by the sample to the new benchmark employment level, as well as updated net birth-death model forecasts and new seasonal adjustment factors. Revisions to November and December also reflect incorporation of additional sample receipts. For more information about the methodology of benchmarking in the CES program, see the CES Technical Notes available at www.bls.gov/web/empsit/cestn.htm#section7b.

Table 1. Differences in seasonally adjusted levels and over-the-month changes, total nonfarm employment, January to December 2020 (in thousands)
2020 Levels Over-the-month changes
As Revised As Previously Published Difference As Revised As Previously Published Difference

January

152,234 152,212 22 315 214 101

February

152,523 152,463 60 289 251 38

March

150,840 151,090 -250 -1,683 -1,373 -310

April

130,161 130,303 -142 -20,679 -20,787 108

May

132,994 133,028 -34 2,833 2,725 108

June

137,840 137,809 31 4,846 4,781 65

July

139,566 139,570 -4 1,726 1,761 -35

August

141,149 141,063 86 1,583 1,493 90

September

141,865 141,774 91 716 711 5

October

142,545 142,428 117 680 654 26

November

142,809 142,764 45 264 336 -72

December (p)

142,582 142,624 -42 -227 -140 -87

Footnotes
(p) Preliminary

To Table of Figures

Overview

Establishment survey benchmarking is done each year to align employment estimates from the survey with employment counts derived primarily from the administrative file of employees covered by Unemployment Insurance (UI). All employers covered by UI laws are required to report employment and wage information to the appropriate state UI agency four times per year. About 97 percent of total nonfarm employment within the scope of the establishment survey is covered by UI. The UI data are obtained and edited by each state’s Labor Market Information agency. They are tabulated and published through the BLS Quarterly Census of Employment and Wages (QCEW) program. Both the QCEW and CES categorize their data using the North American Industry Classification System (NAICS).

An employment count for the remaining 3 percent is constructed from other sources, primarily records from the Railroad Retirement Board and Census Bureau data from County Business Patterns and the Annual Survey of Public Employment and Payroll. This 3 percent is referred to as noncovered employment. The combination of QCEW and noncovered employment data make up the benchmark level. The full benchmark employment level developed for March replaces the March sample-based estimate for each basic cell.

The total annual revision is the difference between the benchmark level for a given March and the published March sample-based employment estimate. The overall accuracy of the establishment survey is usually gauged by the size of the benchmark revision, which is often regarded as a proxy for total survey error. Typically, the total revision is equal to the benchmark revision, but in years with historical reconstructions, affected CES series are re-estimated prior to benchmarking. The benchmark revision, in these cases, is the difference between the benchmark level and the newly reconstructed sample-based estimate. The benchmark revision is the difference between two independently derived employment counts, each subject to its own error sources.

In order to create a continuous time series between the new March benchmark level and historical sample-based data from the prior March benchmark level, employment estimates for the months between the most recent March benchmark and the previous year's benchmark are adjusted using a linear "wedge-back" procedure. This procedure assumes that the total estimation error accumulated at a steady rate since the last benchmark. For the 9 months following the March benchmark (also called the post-benchmark period), BLS applies previously derived over-the-month sample changes to the revised March level to get the revised estimates. New net birth-death model forecasts are also calculated and applied during post-benchmark estimation. More information on benchmarks in the CES program is available in the Benchmarks section of the CES Technical Notes and in the October 2017 Monthly Labor Review, "Benchmarking the Current Employment Statistics National Estimates."

Seasonally adjusted revisions

Table 2 presents revised employment data on a seasonally adjusted basis for March 2020 by major industry sector. The revision to seasonally adjusted total nonfarm employment is −250,000.

Table 2. Seasonally adjusted employment revisions for major industry sectors, March 2020 (in thousands)
CES Industry Code CES Industry Title As Revised As Previously Published Differences
Amount Percent

00-000000

Total nonfarm 150,840 151,090 -250 -0.2

05-000000

Total private 128,066 128,362 -296 -0.2

06-000000

Goods-producing 20,949 21,086 -137 -0.7

07-000000

Service-providing 129,891 130,004 -113 -0.1

08-000000

Private service-providing 107,117 107,276 -159 -0.1

10-000000

Mining and logging 674 706 -32 -4.7

20-000000

Construction 7,557 7,574 -17 -0.2

30-000000

Manufacturing 12,718 12,806 -88 -0.7

31-000000

Durable goods 7,961 8,031 -70 -0.9

32-000000

Nondurable goods 4,757 4,775 -18 -0.4

40-000000

Trade, transportation, and utilities 27,729 27,723 6 (1)

41-420000

Wholesale trade 5,876.6 5,922.2 -45.6 -0.8

42-000000

Retail trade 15,483.6 15,586.6 -103.0 -0.7

43-000000

Transportation and warehousing 5,822.1 5,668.2 153.9 2.6

44-220000

Utilities 547.0 545.9 1.1 0.2

50-000000

Information 2,898 2,888 10 0.3

55-000000

Financial activities 8,850 8,827 23 0.3

60-000000

Professional and business services 21,318 21,456 -138 -0.6

65-000000

Education and health services 24,347 24,408 -61 -0.3

70-000000

Leisure and hospitality 16,133 16,124 9 0.1

80-000000

Other services 5,842 5,850 -8 -0.1

90-000000

Government 22,774 22,728 46 0.2
Footnotes

(1) Absolute revision is less then 0.05 percent.

To Table of Figures

Typically, 5 years of seasonally adjusted data are revised with each CES annual benchmark. However, reconstructed series are seasonally adjusted over their revised time spans.

For technical information on how seasonal adjustment is performed in the CES program, see the Seasonal Adjustment section of the CES Technical Notes.

For more information on seasonal adjustment model specifications and special model adjustments, see the CES Seasonal Adjustment Files and Documentation page.

Not seasonally adjusted revisions

Table 3 presents the employment benchmarks for March 2020, not seasonally adjusted, by major industry sector. The total revision to not seasonally adjusted total nonfarm employment is −121,000.

Table 3. Not seasonally adjusted employment benchmarks for major industry sectors, March 2020 (in thousands)
CES Industry Code CES Industry Title Benchmark Estimate Differences
Amount Percent
00-000000 Total nonfarm 149,952 150,073 -121 -0.1
05-000000 Total private 126,825 127,009 -184 -0.1
06-000000 Goods-producing 20,638 20,738 -100 -0.5
07-000000 Service-providing 129,314 129,335 -21 (1)
08-000000 Private service-providing 106,187 106,271 -84 -0.1
10-000000 Mining and logging 669 696 -27 -4.0
20-000000 Construction 7,297 7,295 2 (1)
30-000000 Manufacturing 12,672 12,747 -75 -0.6
31-000000 Durable goods 7,949 8,013 -64 -0.8
32-000000 Nondurable goods 4,723 4,734 -11 -0.2
40-000000 Trade, transportation, and utilities 27,423 27,399 24 0.1
41-420000 Wholesale trade 5,847.9 5,895.9 -48.0 -0.8
42-000000 Retail trade 15,286.8 15,365.1 -78.3 -0.5
43-000000 Transportation and warehousing 5,741.7 5,592.8 148.9 2.6
44-220000 Utilities 546.5 545.4 1.1 0.2
50-000000 Information 2,888 2,874 14 0.5
55-000000 Financial activities 8,805 8,780 25 0.3
60-000000 Professional and business services 21,050 21,173 -123 -0.6
65-000000 Education and health services 24,471 24,518 -47 -0.2
70-000000 Leisure and hospitality 15,745 15,714 31 0.2
80-000000 Other services 5,805 5,813 -8 -0.1
90-000000 Government 23,127 23,064 63 0.3
Footnotes

(1) Absolute revision is less then 0.05 percent.

To Table of Figures

Benchmarks for more detailed industries can be found at www.bls.gov/web/empsit/cesbmart-tables.htm.

Table 4 below shows the recent history of not seasonally adjusted total nonfarm percent and level benchmark revisions. Over the prior 10 years, the annual benchmark revision at the total nonfarm level has averaged 0.2 percent (in absolute terms), with a range of −0.3 percent to 0.3 percent.

The differences listed in table 4 and beyond reflect the error due to normal benchmarking procedures after the incorporation of reconstructions. Those years are footnoted.

Table 4. Percent and level differences between nonfarm employment benchmarks and estimates by industry supersector (thousands), March 2010-2020
CES Industry Code CES Industry Title Type 2010 (1) 2011 (2) 2012 2013 (3) 2014 2015 (4) 2016 2017 (5) 2018 (6) 2019 (7) 2020

00-000000

Total nonfarm Percent -0.3 0.1 0.3 -0.1 (8) -0.1 -0.1 0.1 (8) -0.3 -0.1
Level -378 162 424 -119 67 -172 -81 135 -16 -489 -121

05-000000

Total private Percent -0.4 0.1 0.4 -0.1 0.1 -0.2 -0.1 0.1 -0.1 -0.4 -0.1
Level -391 134 481 -126 105 -232 -151 133 -104 -505 -184

10-000000

Mining and logging Percent -3 -0.4 1.6 -1.2 -1.8 -2.2 -3.2 -4.6 -1.1 -2.1 -4
Level -20 -3 13 -10 -16 -19 -22 -30 -8 -15 -27

20-000000

Construction Percent -1.3 -0.5 1.8 0.3 1.6 0.6 0.7 0.8 0.6 -0.1 (8)
Level -67 -26 93 14 90 39 47 52 44 -4 2

30-000000

Manufacturing Percent -1 0.1 -0.2 0.2 0.4 -0.1 0.5 0.1 -0.1 (8) -0.6
Level -119 9 -25 23 43 -12 58 15 -18 -4 -75

40-000000

Trade, transportation, and utilities Percent -0.6 0.4 0.6 -0.5 -0.1 (8) -0.4 0.3 -0.3 -0.4 0.1
Level -143 95 145 -131 -31 -5 -110 75 -77 -117 24

41-420000(9)

Wholesale trade Percent -2.3 -0.2 0.8 -0.4 -0.8 -0.7 -1.1 -0.4 -0.9 -0.7 -0.8
Level -124.5 -13.1 45.3 -20.2 -45.4 -41.3 -66.6 -21.2 -54.4 -38.6 -48.0

42-000000(9)

Retail trade Percent -0.1 0.6 0.5 -0.8 (8) -0.2 -0.8 0.1 -0.6 -1.0 -0.5
Level -18.4 83.8 78.9 -110.3 5.5 -23.5 -118.2 15.4 -96.4 -150.8 -78.3

43-000000(9)

Transportation and warehousing Percent 0.1 0.5 0.7 0.1 0.2 1.4 1.7 1.6 1.4 1.4 2.6
Level 3.1 22.4 29.4 3.6 9.7 65.3 83.5 79.8 72.7 75.8 148.9

44-220000(9)

Utilities Percent -0.6 0.5 -1.5 -0.8 -0.1 -0.8 -1.6 0.2 0.3 -0.7 0.2
Level -3.4 2.8 -8.5 -4.6 -0.6 -4.7 -8.7 1.0 1.8 -4.1 1.1

50-000000

Information Percent -0.4 -0.4 1.8 -0.2 2.4 -1.6 -0.1 2.5 2.1 1.2 0.5
Level -11 -12 47 -5 66 -44 -2 70 59 35 14

55-000000

Financial activities Percent 0.4 0.9 0.6 -0.1 0.2 -0.1 (8) 0.1 -0.1 0.8 0.3
Level 34 69 45 -10 19 -9 -4 7 -12 68 25

60-000000

Professional and business services Percent (8) 0.7 (8) (8) -0.8 -0.6 -0.6 -1.3 -0.4 -0.8 -0.6
Level -3 125 2 4 -147 -110 -125 -270 -72 -159 -123

65-000000

Education and health services Percent (8) -0.5 (8) -0.3 -0.1 (8) -0.4 0.3 (8) -0.4 -0.2
Level 7 -108 -2 -61 -16 -7 -83 70 5 -95 -47

70-000000

Leisure and hospitality Percent -0.6 0.7 0.8 0.5 0.3 -0.3 0.7 0.8 (8) -1.1 0.2
Level -80 93 104 72 38 -45 102 126 -4 -170 31

80-000000

Other services Percent 0.2 -2 1.1 -0.4 1.1 -0.4 -0.2 0.3 -0.4 -0.8 -0.1
Level 11 -108 59 -22 59 -20 -12 18 -21 -44 -8

90-000000

Government Percent 0.1 0.1 -0.3 (8) -0.2 0.3 0.3 (8) 0.4 0.1 0.3
Level 13 28 -57 7 -38 60 70 2 88 16 63

Footnotes:
(1) With the 2010 benchmark, CES reconstructed historical national employment levels of all employees for other federal government (91-999900) to reflect corrections to initial counts for Census temporary and intermittent workers for Census 2010. The reconstructions resulted in about 4,000 employment moving out of other federal government (91-999900). For more information about this reconstruction, see the Reconstruction section in the 2010 CES Benchmark Article.
(2) A review of industries for the possible presence of noncovered employment yielded 13 additional industries. As a result of including these industries, employment in the amount of 95,000 was added to the benchmark nonfarm level. For more information, see the Changes to noncovered employment section of the 2011 Benchmark Article.
(3) With the 2013 benchmark, CES reconstructed several national employment series. Each first quarter, the Quarterly Census of Employment and Wages (QCEW) program, whose data account for approximately 97 percent of the CES universe scope (see The Sample section of the CES Technical Notes), incorporates updated industry assignments. In 2013, these updates included two substantial groups of nonrandom, noneconomic code changes, one to funds, trusts, and other financial vehicles (NAICS 525), and the other, a reclassification of approximately 466,000 in employment from private households (NAICS 814), which is out of scope for CES, to services for the elderly and persons with disabilities (NAICS 62412), which is in scope. These changes also had an impact, beyond what would be considered typical for a given benchmark year, on corresponding CES series. For more information about the changes to these industries, see the QCEW First Quarter 2013 News Release or the Special notice regarding reconstructed data section in the 2013 CES Benchmark Article.
(4) With the 2015 benchmark, CES reconstructed the national employment series 65-624120, services for the elderly and persons with disabilities back to January 2000. CES previously reconstructed this series with the 2013 benchmark; however, between the 2013 and 2015 benchmark, a better source of information for the employment within NAICS 62412 for the state of California was found. The inclusion of the reconstructed series resulted in total nonfarm and total private employment that was 27,000 less than the originally published March 2015 estimate level. The difference between the benchmarked and originally published March 2015 estimate level is −199,000 or −0.1 percent. This table displays March 2015 data after accounting for the decrease of 27,000 from the reconstructed series. Similarly, for the education and health services supersector, this table displays March 2015 data after incorporating the reconstructed series. For more information about this reconstruction, see the Reconstruction section of the 2015 Benchmark Article.
(5) With the 2017 benchmark, CES reconstructed the national employment series 60-561613, security guards and patrols and armored car services back to October 2016 to correct a microdata error. The inclusion of the reconstructed series resulted in total nonfarm and total private employment that was 3,000 more than the originally published March 2017 estimate level. The difference between the benchmarked and originally published March 2017 estimate level is 138,000 or 0.1 percent. This table displays March 2017 data after accounting for the increase of 3,000 from the reconstructed series. Similarly, for the professional and business services supersector, this table displays March 2017 data after incorporating the reconstructed series. For more information, see the Reconstructions section in the 2017 Benchmark Article.
(6) With the 2018 benchmark, CES reconstructed several national employment series. A recoding effort in the QCEW resulted in about 336,000 employment in wholesale trade agents and brokers (41-425120) moved into other series within the wholesale trade, retail trade, transportation and warehousing, and professional and business services major industry sectors. Affected basic-level series were reconstructed for their entire history, generally back to January 1990. Additionally, a reclassification of a state employer to private ownership caused a shift of about 17,000 employment from the CES series other state government (90-922999) into services for the elderly and persons with disabilities (65-624120). Affected basic-level series were reconstructed from March 2018 back to January 2018. For more information about this reconstruction, see the Reconstruction section in the 2018 CES Benchmark Article.
(7) With the 2019 benchmark, BLS reconstructed some national employment series in transportation to correct an error in rail transportation (43-482000), which had resulted in 16,000 in employment being double counted. The reconstruction removed the doubled-counted employment and affected aggregates of rail transportation, up to and including total nonfarm, back to January 1990. While the difference between the benchmarked and originally published March 2019 estimate level is −505,000, or −0.3 percent, this table displays March 2019 data after accounting for the removal of 16,000 from the published series. For more information, see the Reconstructions section in the 2019 CES Benchmark Article.
(8) Absolute revision is less than 0.05 percent.
(9) Indented industries are part of trade, transportation, and utilities.

To Table of Figures

Benchmark revision effects for other data types

Benchmarking also affects the series for production and nonsupervisory employees (PE) and women employees (WE). There are no benchmark employment levels for these series; they are revised by preserving ratios of employment for the particular data type to the all employee (AE) level prior to benchmarking, and then applying these ratios to the revised all employee level. These figures are calculated at the basic cell level and then aggregated to produce the summary estimates. Average weekly hours (AWH), average hourly earnings (AHE), and, in manufacturing industries, average weekly overtime hours (AWOH) are not benchmarked; they are estimated solely from reports supplied by survey respondents at the basic estimating cell level. New employment benchmarks can additionally affect indirectly estimated data types. For more information on indirectly estimated data types, see the Available Data section in the CES Technical Notes.

Table 5 lists directly estimated data types and their common abbreviations. Directly estimated data types except for AE are collectively called non-AE data types.

Table 5. Directly estimated data types
Data Type Abbreviation
All employees AE
Production and nonsupervisory employees PE
Women employees WE
Average weekly hours of all employees AE AWH
Average hourly earnings of all employees AE AHE
Average weekly overtime hours of all employees AE AWOH
Average weekly hours of production and nonsupervisory employees PE AWH
Average hourly earnings of production and nonsupervisory employees PE AHE
Average weekly overtime hours of production and nonsupervisory employees PE AWOH

To Table of Figures

The aggregate industry levels of the hours and earnings series are derived as a weighted average. AE and PE estimates for basic cells act as weights for their respective hours and earnings estimates for broader industry groupings. Adjustments of AE estimates to new benchmarks may alter the implicit weights used for both AE and PE hours and earnings, which, in turn, may change the estimates for both AE and PE hours and earnings at higher levels of aggregation.

Generally, new employment benchmarks have little effect on hours and earnings estimates for major industry groupings. To influence the hours and earnings estimates of a broader industry group, employment revisions have to be relatively large and must affect industries that have hours or earnings averages that are substantially different from those of other industries in their broader group.

Table 6 and table 7 provide information on the not seasonally adjusted levels of major industry sector hours and earnings series resulting from the March 2020 benchmark. At the total private level, there was no change in average weekly hours estimates for AE or PE from the previously published level. Total private average hourly earnings increased by 3 cents for AE and increased by 4 cents for PE from the previously published level.

Benchmark effects on hours and earnings for more detailed industries can be found at www.bls.gov/web/empsit/cesbmart-tables.htm.

Table 6. Effect of March 2020 benchmark revisions to all employees average weekly hours and average hourly earnings estimates, major industry sectors
CES Industry Code CES Industry Title Average Weekly Hours Average Hourly Earnings
Estimated Revised Difference Estimated Revised Difference

05-000000

Total private

34.3 34.3 0.0 $28.88 $28.91 $0.03

06-000000

Goods-producing

39.9 39.9 0.0 29.66 29.66 0.00

08-000000

Private service-providing

33.2 33.2 0.0 28.70 28.73 0.03

10-000000

Mining and logging

45.3 45.4 0.1 35.21 34.89 -0.32

20-000000

Construction

38.6 38.6 0.0 31.33 31.35 0.02

30-000000

Manufacturing

40.4 40.4 0.0 28.41 28.42 0.01

31-000000

Durable goods

40.7 40.7 0.0 29.75 29.76 0.01

32-000000

Nondurable goods

39.8 39.8 0.0 26.10 26.11 0.01

40-000000

Trade, transportation, and utilities

34.2 34.2 0.0 24.86 24.84 -0.02

41-420000

Wholesale trade

39.1 39.1 0.0 31.95 31.93 -0.02

42-000000

Retail trade

30.7 30.7 0.0 20.35 20.36 0.01

43-000000

Transportation and warehousing

37.8 37.8 0.0 25.26 25.16 -0.10

44-220000

Utilities

42.1 42.1 0.0 42.84 42.82 -0.02

50-000000

Information

36.7 36.8 0.1 43.57 43.66 0.09

55-000000

Financial activities

38.2 38.2 0.0 37.20 37.20 0.00

60-000000

Professional and business services

36.4 36.4 0.0 34.92 34.94 0.02

65-000000

Education and health services

33 33 0.0 27.94 28.06 0.12

70-000000

Leisure and hospitality

24.4 24.4 0.0 16.90 16.93 0.03

80-000000

Other services

31.7 31.6 -0.1 25.99 26.18 0.19

To Table of Figures

Table 7. Effect of March 2020 benchmark revisions to production employees average weekly hours and average hourly earnings estimates, major industry sectors
CES Industry Code CES Industry Title Average Weekly Hours Average Hourly Earnings
Estimated Revised Difference Estimated Revised Difference

05-000000

Total private

33.5 33.5 0.0 $24.23 $24.27 $0.04

06-000000

Goods-producing

40.5 40.5 0.0 25.13 25.14 0.01

08-000000

Private service-providing

32.3 32.3 0.0 24.05 24.09 0.04

10-000000

Mining and logging

45.8 45.9 0.1 31.09 30.99 -0.10

20-000000

Construction

38.9 38.9 0.0 28.95 28.97 0.02

30-000000

Manufacturing

41.1 41.1 0.0 22.57 22.58 0.01

31-000000

Durable goods

41.3 41.3 0.0 23.55 23.56 0.01

32-000000

Nondurable goods

40.8 40.8 0.0 20.97 20.97 0.00

40-000000

Trade, transportation, and utilities

33.9 34 0.1 21.05 21.04 -0.01

41-420000

Wholesale trade

38.7 38.7 0.0 26.49 26.47 -0.02

42-000000

Retail trade

30.5 30.5 0.0 17.04 17.04 0.00

43-000000

Transportation and warehousing

37.7 37.7 0.0 22.70 22.60 -0.10

44-220000

Utilities

42.5 42.5 0.0 37.87 37.85 -0.02

50-000000

Information

35.8 35.9 0.1 34.86 34.98 0.12

55-000000

Financial activities

37.3 37.3 0.0 28.66 28.67 0.01

60-000000

Professional and business services

35.7 35.7 0.0 28.90 28.92 0.02

65-000000

Education and health services

32.2 32.2 0.0 24.88 24.98 0.10

70-000000

Leisure and hospitality

23.1 23.1 0.0 14.69 14.71 0.02

80-000000

Other services

30.7 30.6 -0.1 22.14 22.34 0.20

To Table of Figures

Revisions to net birth-death

The difference between CES estimates and the population employment results from various sources, and disaggregating it into its components is complex. Both are subject to nonresponse and reporting error. Additionally, the CES estimates are subject to sampling error and business birth-death modeling error. A analysis of error in the birth-death model and the effect of those errors on CES estimation follows.

The CES sample alone is not sufficient for estimating the total nonfarm employment level because each month new establishments generate employment that cannot be captured through the sample. There is an unavoidable lag between an establishment opening for business and its appearance on the CES sample frame. The sample frame is built from UI quarterly tax records. These records cover virtually all U.S. employers and include business births, but they only become available for updating the CES sampling frame 7 to 9 months after the reference month. After the births appear on the frame, there is also time required for sampling, contacting, and soliciting cooperation from the establishments, and verifying the initial data provided. In practice, BLS cannot sample and begin to collect data from new establishments until they are at least a year old.

BLS has researched both sample-based and model-based approaches to measuring employment from business births and deaths that have not yet appeared on the UI universe frame. The research demonstrated that sampling for births was not feasible in the very short CES production timeframes, so BLS uses a model-based approach to account for this employment. This model incorporates two components. The first component is an indirect imputation for business deaths. The second component is an autoregressive integrated moving average (ARIMA) time series model designed to estimate the net birth-death employment not accounted for by the imputation from the first component. More information on the CES birth-death model is available in the Birth-Death Model section of the CES Technical Notes.

Forecasted vs. actual net birth-death

Only error from the second component is directly measurable. Error from this component is measured by comparing the actual net of births and deaths with the model-based forecast that was used in the CES sample-based estimates. Most recently, the data from April 2019 to March 2020 can be measured. As table 8 shows, the actual net birth-death from April 2019 to March 2020 was approximately 242,000 below the forecast used in the CES monthly estimates for the same period.

Table 8. Differences between forecasted and actual net birth-death, total private employment, April 2019 to March 2020 (in thousands)
Benchmark 2020 2019 2020 Total
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Actual Net Birth-Death

286 220 71 234 117 -118 340 27 -58 -140 123 -278 824

Forecast Net Birth-Death

282 209 109 186 95 -75 304 -16 -52 -145 143 26 1,066

Difference

4 11 -38 48 22 -43 36 43 -6 5 -20 -304 -242

Cumulative Difference

4 15 -23 25 47 4 40 83 77 82 62 -242

To Table of Figures

Net birth-death adjustments to the post-benchmark period

From April 2020 to December 2020, also called the post-benchmark period, CES estimates were recalculated for each month based primarily on new benchmark levels and new net birth-death forecasts. Net birth-death forecasts were revised to incorporate information from the most recent year of universe employment counts. Table 9 shows the net birth-death values for the supersectors over the post-benchmark period. From April 2020 to December 2020, the net birth-death model cumulatively added 796,000 jobs, compared with 789,000 in the previously published April 2020 to December 2020 employment estimates.

Table 9. Net birth-death forecasts by industry supersector, April to December 2020 (in thousands)
CES Industry Code CES Industry Title Apr May Jun Jul Aug Sep Oct Nov Dec Cumulative
Total

10-000000

Mining and logging

-3 0 0 1 0 0 1 0 0 -1

20-000000

Construction

-41 73 31 9 10 4 29 -9 -11 95

30-000000

Manufacturing

-37 14 21 0 4 4 6 3 1 16

40-000000

Trade, transportation, and utilities

-72 25 20 19 18 17 49 10 10 96

41-420000(1)

Wholesale trade

-21 3 -7 -2 -4 0 9 2 2 -18

42-000000(1)

Retail trade

-28 18 18 12 12 8 23 -4 4 63

43-000000(1)

Transportation and warehousing

-23 4 9 8 10 9 17 12 4 50

44-220000(1)

Utilities

0 0 0 1 0 0 0 0 0 1

50-000000

Information

3 4 -1 6 4 -1 9 4 -1 27

55-000000

Financial activities

-11 11 -1 10 11 -2 30 3 9 60

60-000000

Professional and business services

-171 32 17 78 43 -33 134 4 31 135

65-000000

Education and health services

-24 24 -14 40 21 -7 70 8 -14 104

70-000000

Leisure and hospitality

-105 124 154 89 25 -43 22 -23 -4 239

80-000000

Other services

-9 12 8 2 6 -3 13 -1 -3 25

Total private net birth-death forecast

-470 319 235 254 142 -64 363 -1 18 796

Footnotes
(1) Indented industries are part of trade, transportation, and utilities.

To Table of Figures

Net birth-death changes due to the COVID-19 pandemic

Current estimates of not seasonally adjusted employment include both a sample-based component and a model-based component. The model-based portion, called the net birth-death forecast, is intended to account for businesses that have closed or opened since the sample was initially drawn. While this model performs well in times of relative stability, it has not traditionally included a mechanism to account for rapid changes in the most recent months of employment estimates.

In March 2020, the COVID-19 pandemic created a severe economic shock to the global economy, resulting in massive job losses across the United States. This widespread disruption to labor markets and the potential impact to the birth-death model prompted BLS to revisit research conducted after the Great Recession (2007-09) and incorporate new ideas to account for changes in the number of business openings and closings. Two areas of research were implemented to improve the accuracy of the birth-death model in the CES estimates. These adjustments better reflect the net effect of the contribution of business births and deaths to the estimates. These two methodological changes, one to adjust each of the two steps in the birth-death model, are the following:

  • A portion of both reported zero employment and returns from zero in the current month from the sample were used in estimation to better account for the fact that business births and deaths do not offset.

  • Current sample growth rates were included in the net birth-death forecasting model to better account for the changing relationships between business openings and closings.

First, a proportion of reports that fell to zero employment and reports that returned from zero employment in each month were used to adjust the weighted contribution of each report used in the calculation of the over-the-month change of the sample-based estimates. Typically, reports with zero employment in either the previous or current month are not included in estimation. To account for an excess amount of reports going to zero employment and reports returning from zero employment, BLS calculated the likelihood that either a reported zero or a return from zero exceeded what would be expected for the month. These "excess declines to zero" and "excess returns from zero" (collectively called excess reported zeroes) partially account for drops in employment (when more business deaths than are usually observed in historical population data occur) and for increases in employment (when there are more business births than normal). More specifically, "excess declines to zero" were used in March final and subsequent months' first preliminary, second preliminary, and final estimates. "Excess returns from zero" were used in first, second, and final estimates from May to the present.

Second, BLS adjusted the portion of business births and deaths that cannot be accounted for using sample data by including more recent information. Net birth-death forecasts are normally modeled using an ARIMA based on over-the-month changes of 5 years of historical birth-death residual values that end 9 months before the forecast of the current month. Instead of using only historical data—data that would not accurately account for how the labor market has changed due to COVID-19—a regression variable that includes data up to the current month was included in the model. The regression variable is the CES sample-based ratio of over-the-month change, known as the sample link, for each of the major industry sectors. Each major industry sector sample link was used as a regressor for the basic-level industry forecasts only within that sector.

The use of sample links as regression variables in the model initially accounted for a difference of −174,000 in the net birth-death forecasts from April 2020 to December 2020, with a range from −799,000 to 222,000. Exhibit 1 below outlines monthly differences due to the inclusion of the sample link regressor.

Exhibit 1. Preliminary and revised net birth-death forecasts for total private with and without regressor adjustments, not seasonally adjusted (in thousands)
2020 Preliminary Forecast Revised Forecast
With Adjustment Without Adjustment Difference With Adjustment Without Adjustment Difference

April

-553 246 -799 -470 282 -752

May

345 207 138 319 203 116

June

295 73 222 235 68 167

July

241 193 48 254 211 43

August

154 104 50 142 95 47

September

-62 -99 37 -64 -96 32

October

344 293 51 363 313 50

November

6 2 4 -1 0 -1

December

19 -56 75 18 -48 66

Total

789 963 -174 796 1,028 -232

To Table of Figures

The effect of these adjustments to CES estimates of employment reflect the pronounced impact of the COVID-19 pandemic. Exhibit 2 illustrates the difference at the total private level between the published CES estimates that do use these two adjustments and a simulated CES series calculated without using either adjustment. The total private benchmark revision amount applied to March 2020 was −184,000. Without these adjustments to the birth-death model, the benchmark revision amount would have been 385,000 lower, or −569,000.

Exhibit 2. Effects of adjusted net birth-death and use of reported zeroes on total private employment before benchmarking, not seasonally adjusted (in thousands)
2020 Total Private Employment with Adjustments Total Private Employment without Adjustments Difference

March

127,009(1) 127,394 -385

April

108,158 111,786 -3,628

May

111,865 114,768 -2,903

June

117,309 119,280 -1,972

July

118,805 120,514 -1,708

August

119,717 121,313 -1,596

September

120,110 121,643 -1,533

October

121,571 123,024 -1,453

November

122,161 123,593 -1,433

December

122,026 123,418 -1,392

Footnotes
(1) Net birth-death forecasts for March were not adjusted to incorporate the sector sample link regressors. However, adjustments for excess reported zeroes were included in the estimates for March.

To Table of Figures

BLS continues to use sample links that account for excess reported zeroes and adjusted net birth-death forecasts in monthly employment estimates. Research is being done on a monthly basis into when to return to normal estimation. Several factors are being monitored, including reverting to expected proportions of units that newly report zero or return from zero in the current month, resumption of previous patterns in the birth-death forecasts, and some combination of the two.

QCEW imputation

Every quarter, the QCEW program imputes employment for UI accounts where reports were not received or were received but contained only wage information and no employment data. Typically, only a small concentration of worksites and employment are imputed. In the November 2020 QCEW news release of second quarter 2020 data and second published version of first quarter 2020 data, BLS implemented improvements to QCEW imputation methodology. Improvements to the QCEW imputation methodology are described in more detail at www.bls.gov/cew/additional-resources/imputation-methodology.htm.

Changes in the QCEW imputation methodology had little effect on the CES-National March 2020 benchmark. The total effect of the new imputation methodology on the QCEW portion of the employment population count was 0.02 percent.

Changes to the CES published series

With the release of the January 2021 first preliminary estimates on February 5, 2021, BLS incorporated series changes related to annual sample adequacy and disclosure review.

Small domain model updates

The CES small domain model is a weighted least squares model with two employment inputs: (1) an estimate based on available CES sample for that series, and (2) an ARIMA projection based on trend from 10 years of historical QCEW data. CES-National began using the small domain model in 2007. For more information about it, see the Small Domain Model section of the CES Technical Notes.

Two series estimated using the small domain model have been discontinued along with their component industries: direct health and medical insurance carriers (55-524114) and recreational and vacation camps (70-721214).

Two other series have received adequate sample and have stopped using the small domain model: other technical consulting services (60-541690) and remediation services (60-562910). These series are now being estimated using the standard CES weighted-link-relative technique.

BLS will continue to use the model for estimates in lessors of nonfinancial intangible assets (55-533000) and tax preparation services (60-541213).

Series changes due to annual sample review

All CES series are evaluated annually for sample size, coverage, and response rates. The following changes result from a re-evaluation of the sample and universe coverage for CES industries, which are based on NAICS 2017. Some industries no longer have sufficient sample to be estimated and published separately and were discontinued or combined with other similar industries for estimation and publication purposes. This information is also available at www.bls.gov/web/empsit/cesnewseries.htm.

A list of currently published CES series is available at www.bls.gov/web/empsit/cesseriespub.htm.

Table 10. Series with CES Industry Code or Title Changes
NAICS Code Previous New
CES Industry Code CES Industry Title CES Industry Code CES Industry Title

56145,9

60-561490 Other business support services 60-561490 Other business support services, including credit bureaus

To Table of Figures

In order to more easily identify affected series and because AE series are published at a more detailed industry level than non-AE series, series changes are shown for AE and non-AE data types. The first two tables in this section reference the AE data type and the third table references all non-AE data types. The tables display an AE collapse and discontinued series for AE and non-AE data types. Discontinued series tables (table 11 and table 13) display series for which the data types noted are no longer published. The collapsed series table (table 12) displays series for which the data types noted are no longer published because the industry no longer has sufficient sample to be estimated and published separately. Affected industries have been combined with other similar industries for estimation and publication purposes. Historical data for these series were reconstructed to provide consistent time series. Industries that are no longer published for AE will also no longer be published for other directly estimated data types or derivative series.

Table 11. Discontinued all employee series
NAICS Code CES Industry Code CES Industry Title Next Highest Published Industry

332721

31-332721 Precision turned products Turned products and screws, nuts, and bolts (31-332720)

332722

31-332722 Bolts, nuts, screws, rivets, and washers Turned products and screws, nuts, and bolts (31-332720)

3152

32-315200 Cut and sew apparel Apparel (32-315000)

31521

32-315210 Cut and sew apparel contractors Apparel (32-315000)

3151,9

32-315900 All other apparel manufacturing Apparel (32-315000)

524113

55-524113 Direct life insurance carriers Direct life and health insurance carriers (55-524110)

524114

55-524114 Direct health and medical insurance carriers Direct life and health insurance carriers (55-524110)

721211

70-721211 RV parks and campgrounds RV parks and recreational camps (70-721200)

721214

70-721214 Recreational and vacation camps RV parks and recreational camps (70-721200)

To Table of Figures

Table 12. Collapsed all employee series
Previous New

NAICS Code

CES Industry Code CES Industry Title NAICS Code CES Industry Code CES Industry Title

56145

60-561450 Credit bureaus 56145,9 60-561490 Other business support services, including credit bureaus

56149

60-561490 Other business support services

To Table of Figures

Table 13. Discontinued series other than all employees
NAICS Code CES Industry Code CES Industry Title Discontinued From Publication Next Highest Published Industry

3334

31-333400 HVAC and commercial refrigeration equipment PE AWOH Machinery (31-333000)

33391

31-333910 Pumps and compressors WE Other general purpose machinery (31-333900)

33399

31-333990 All other general purpose machinery WE Other general purpose machinery (31-333900)

336211

31-336211 Motor vehicle bodies AE AWH, AE AHE, AE AWOH, WE Motor vehicle bodies and trailers (31-336200)

33637

31-336370 Motor vehicle metal stamping AE AWH, AE AHE Motor vehicle parts (31-336300)

339116

31-339116 Dental laboratories PE, PE AWH, PE AHE Medical equipment and supplies (31-339100)

3132

32-313200 Fabric mills WE Textile mills (32-313000)

3141

32-314100 Textile furnishings mills WE Textile product mills (32-314000)

3149

32-314900 Other textile product mills WE Textile product mills (32-314000)

3261

32-326100 Plastics products PE AWOH Plastics and rubber products (32-326000)

32611

32-326110 Plastics packaging materials, film, and sheet PE AWOH Plastics and rubber products (32-326000)

32614,5

32-326150 Foam products PE AWOH Plastics and rubber products (32-326000)

32619

32-326190 Other plastics products PE AWOH Plastics and rubber products (32-326000)

3262

32-326200 Rubber products PE AWOH Plastics and rubber products (32-326000)

42493

41-424930 Nursery stock and florists' supplies PE, PE AWH, PE AHE Misc. nondurable goods (41-424900)

5323

55-532300 General rental centers PE, PE AWH, PE AHE Rental and leasing services (55-532000)

71321

70-713210 Casinos, except casino hotels WE Gambling industries (70-713200)

71329

70-713290 Other gambling industries WE Gambling industries (70-713200)

811118

80-811118 Other automotive mechanical and elec. repair AE AWH, AE AHE Automotive mechanical and electrical repair (80-811110)

81231

80-812310 Coin-operated laundries and drycleaners PE, PE AWH, PE AHE Drycleaning and laundry services (80-812300)

81232

80-812320 Drycleaning and laundry services, except coin-operated PE, PE AWH, PE AHE Drycleaning and laundry services (80-812300)

To Table of Figures

Availability of revised data

LABSTAT, the BLS public database, contains all historical employment, hours, and earnings data revised as a result of this benchmark, including both not seasonally adjusted and seasonally adjusted data. The data can be accessed at www.bls.gov/ces/data/home.htm, the CES-National Database page.

Previously published data are available on both a not seasonally adjusted and seasonally adjusted basis for all CES industries down to the 3-digit level from the CES Vintage Data page. CES vintage data are typically updated in late February following the annual benchmark revision.

Benchmarks for detailed industries can be found at www.bls.gov/web/empsit/cesbmart-tables.htm.

Table of figures

Tables

Exhibits

Last Modified Date: February 5, 2021