I came across an interesting economic forecast — analysts at Continuum Economics believe that January's ADP data (also known as "small non-farm") will be relatively weak, with only a 30k increase, significantly slower than December's 41k. More notably, this "small non-farm" figure is expected to be far below the non-farm payrolls for the same month, which are projected to grow by 85k.

Speaking of which, over the past six months, ADP data has indeed been relatively weak, averaging about 22k fewer than non-farm employment. Although in December the two figures were nearly the same, analysts expect the gap to widen to 50k in January. They believe the main reason is recent softness in the retail sector, which has little impact on ADP, but non-farm payrolls are expected to rebound from the retail downturn.

Looking at the details, the goods-producing sector (especially construction) may see slight improvement, but the growth rate in the service sector could slow down. Interestingly, the difference between ADP and non-farm payrolls is most pronounced in the service industry, particularly in education and healthcare, where the data deviations are especially large. If this trend continues, traders focusing on economic data should keep an eye on it.