Nonfarm payroll is a measure of the number of workers in the US economy, excluding proprietors, private household employees, unpaid volunteers, farm employees, and the unincorporated self-employed. It is a compiled name for goods, construction, and manufacturing companies in the US, and approximately 80% of the workforce is accounted for nonfarm payrolls. The Bureau of Labor Statistics (BLS) surveys private and government entities throughout the US to obtain information about their payrolls, and the nonfarm payroll numbers are reported monthly to the public through the closely followed Employment Situation summary.
The figure released is the change in nonfarm payrolls (NFP), compared to the previous month, and is usually between +10,000 and +250,000 during non-recessional times. That number is meant to represent the number of jobs added or lost in the economy over the last month, not including jobs relating to the farming industry. The NFP report is typically released on the first Friday of each month, providing the total monthly increase or decrease in paid US workers across most businesses.
The nonfarm payroll report is a key economic indicator for the United States and represents the total number of paid workers in the US excluding those employed by farms, the federal government, private households, and nonprofit organizations. The report is extremely large, so most traders look for three or four key pieces of information, including the headline figure, revisions of previous nonfarm payrolls releases, average hourly earnings, and details on hours worked. The NFP report consistently causes one of the largest rate movements of any news announcement in the foreign exchange market.
