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Today’s Jobs Data: Taking a Close Look |
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We pointed out yesterday the need to look closely at whether sunny economic data in fact aren’t masking growing evidence of two Americas—one for the Ritz-Carlton set and one for the rest of us.
Today’s jobs news provides another opportunity to examine data under such a lens.
The Labor Department reports payrolls increased in May by 157,000, slightly more than economists predicted, after a gain of 80,000 in April. The jobless rate stayed at 4.5 percent. On the surface, the news sounds OK. But let’s dig deeper.
As the Center for Economic and Policy Research (CEPR) points out, different surveys come up with different results. For instance, in contrast with the Labor Department jobs data (the “establishment survey”) the household survey has shown considerably slower employment growth this year, with employment actually falling by 14,000 since January. Further, notes CEPR:
Although virtually all economists view the establishment survey as the better measure of employment, some analysts have recently argued that the household survey gives a better picture of the current employment situation.
Timing also is a factor. For instance, the impact of the housing slump has yet to materialize fully.
And then there’s the issue of revised data. As Bloomberg notes:
There are also signs that the labor market may not have been as strong last year as earlier estimates suggested.
A report this month from the Labor Department, based on tax records from all businesses, showed the economy added 19,000 private-sector jobs in the third quarter. That contrasts with the government’s monthly payroll figures, based on a smaller survey, which showed a gain of 498,000 jobs for the period.
The report showed declines in residential-construction jobs, and more losses may follow in coming months, economists said.
Hmm. A 479,000 difference in the number of jobs. That’s a bit of a gap.
And remember the data we reported yesterday, showing the economy grew .6 percent in the first quarter? Turns out—already—that figure was wrong. The growth, or lack thereof, was even worse: .15 percent.
Accident or data manipulation?
Over at The Agonist, Sean-Paul Kelley thinks the latter:
I get so sick of this shameful media manipulation of economic facts. It’s infuriating and I should have known better and dug into the numbers deeper yesterday. In this post I wrote that the economy in Q1-2007 grew .6% for the quarter (which is still a very bad number). I was wrong, as that was an annualized number. It was worse, much worse, as our vaunted economy in Q1-2007 grew .15%. Did you get that right? .15 % !
Kelley’s headline yesterday says it best: “Wow, That’s Some Economy You Got There George!”
3 Comments
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The information you reported was good but not complete enough. Why doesn’t CEPR also include two other important factors that would contain information needed to give the true picture of the economy.
First the public needs to know how many people are unemployed but have fallen off of the various states unemployed rolls due to the amount of time they have been out of work.
Second the public needs to know how many of these jobs created actually were jobs equal to greater than or less than the incomes the newly employed earned prior to this new employment.
This kind of additional information tells the real story on the economy and employment.
Can this information be included in all future CEPR reports on this issue?
Any jobs data put out by the Bush labor department are just garbage to me and Middle Class America! Since Bush became President and the Republicans controlled Congress, millions of manufacturing jobs were lost, and millions of high-tech white collar jobs had gone overseas. To add to further injury, over 11 million illegal immigrants invaded this country and took whatever jobs are left to American youngters and poor. So how dare do they say that the unemployment is only 4.5 percent?
I agree that any figure put out by Bush is garbage. Maybe it helps the company owners but it hurts the working people. He doesn’t care. Maybe the people that voted Republican will come to their senses and vote Democrat. They will for sure if they have lost there job. Wake-up America. Any Republican is for the rich and the rich only. Last I looked middle class far out numbered the rich in the United States.