Charmaine Buskas, senior economics strategist at TD Securities, said the ADP report usually does a good job of tracking the direction of the payrolls report, but in previous months, including last month, the two indexes have seen quite different results.

The previous ADP report posted a gain of 8,000 private jobs in the month, while the nonfarm payrolls report, released two days afterwards, fell by 80,000 jobs.

Economists from JPMorgan said in the last five months, the first estimate from ADP was on average 98,000 above the first estimate from the Bureau of Labor Statistics. "As a result the ADP report has shown a total drop in payrolls of only 10,000 (after revisions), compared to a 300,000 decline in the BLS numbers."

As a forecasting tool, the ADP report is "not off the table certainly, but it will be scrutinized more closely" this month, Buskas said. She expects more declines in both reports for April, based on the continued rise in jobless claims and anecdotal evidence that companies are laying off workers.

All 25 economists surveyed expect to see the report in the red zone this month, with expectations looking for a loss anywhere between 20,000 and 115,000.

David Resler, senior economist at Nomura Securities, said there is no single good reason for the disparity between the ADP and nonfarm payrolls numbers. However, he suggested that ADP accounts for small and mid-size companies more than large companies, which could mean larger companies are experiencing more weakness.

Resler expects to see the ADP survey fall by 25,000 jobs in April, while nonfarm payrolls will likely fall a more dramatic 110,000, but Resler said the ADP survey is difficult to forecast because its historical record is so short.

Similarly, Buskas said the current downturn is "uncharted territory" for the ADP employment report.

Resler said the market reaction to the ADP survey may be insignificant unless there is a surprise, but it's by no means a number to ignore, he said.

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