Nonfarm payrolls (NFP) is the monthly count of paid U.S. jobs outside farming, published by the Bureau of Labor Statistics (BLS). It is one of the most-watched numbers in jobs headlines, and it is easy to misread. Here is what it counts, what it leaves out, and how to read the monthly change.
What the number counts
The word "nonfarm" is the first boundary. The BLS survey covers nonagricultural establishments, so farm employment is not part of the headline count. The count itself includes people on establishment payrolls who received pay for any part of the pay period that includes the 12th day of the month. Paid sick leave, paid holidays and paid vacation count as employed. People on layoff, on unpaid leave, or on strike for the whole period do not.
The measure counts jobs, not employees. Someone who works at two worksites is counted at each one.
What it leaves out
The BLS handbook lists the groups the data exclude: sole proprietors, the unincorporated self-employed, unpaid volunteer or family workers, farm workers, and domestic workers. Military personnel are excluded from government employment, and several intelligence agencies are excluded as well.
In practice, NFP is not a count of all work in the economy. A freelancer who works alone, a family member who helps in an unpaid role, or a household employee does not appear in the headline, even though they may earn income. Keep this boundary in mind whenever you compare NFP with other labor measures.
Why the headline is an estimate
The figure is a sample-based estimate. BLS collects data from a sample of nonagricultural establishments, not from every employer, and it draws that sample from unemployment insurance tax records. The handbook says the sample includes a randomly selected proportion of businesses and most government agencies. Because of this, the headline can differ from the figure you would get by counting every payroll.
The monthly figure is an estimate of change in paid jobs. A positive number means the survey counted more paid jobs than before.
Check the source yourself
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