Job Numbers: Which do you want - a positive political sound byte or accurate interpretation

[Political Heretic]

Poll question: Job Numbers: Which do you want - a positive political sound byte or accurate interpretation

Someone might have noticed that for the last half hour I keep posting observations, then saying I'm going to bed, then reading more on the jobs report and posting more, then saying I'm going to bed.

But now I'm writing this instead. Because this month we have one of those jobs reports that we really need to pay attention to. It's an example of how unemployment figures are commonly distorted.

The positive political spin would be that unemployment dropped 0.3% in January, a descent one month decline. And there's no question that would be good looking news for Team Democrats. So should we stop there and just tout the surface number?

Consider this: as several other alert DUers have pointed out this morning, the report says that we lost another 20,000 jobs in January. Payrolls dropped.

So that should cause one to say, "hey wait a minute - how did we lose jobs and also drop unemployment at the same time?" The answer is also written into the report itself. The change in unemployment is largely a statistical game. Thousands of workers were moved into a category called "discouraged worker."

The magic of the discouraged worker category is that once a worker is placed in this category - POOF! - they are no longer counted as unemployed, or counted at all. I would recommend reading the report directly from the department of labor. But I snagged a summary from Reuters that describes what happened:

WASHINGTON (Reuters) - Payrolls unexpectedly fell in January, but the unemployment rate surprisingly dropped to a five-month low, according to a government report on Friday that hinted at labor market improvement.

The Labor Department said the economy shed 20,000 jobs after losing 150,000 jobs in December. November was revised to a gain of 64,000, up from 4,000. Annual benchmark revisions to payrolls data showed the economy has purged 8.4 million jobs since the start of the recession in December 2007.

Analysts polled by Reuters had forecast payrolls gaining 5,000 and the unemployment rate to edge up to 10.1 percent in January from 10 percent. Median estimates from the top 20 forecasters expected payrolls to be unchanged last month.

"It shows net-net that we are seeing a slow improvement in the labor market. There are some encouraging signs in the report ... but it wasn't quite good enough to push us into positive territory just yet," said Boris Schlossberg, director of FX Research at GFT Forex in New York.

Stock index futures extended losses, while Treasury debt prices added to gains. The dollar trimmed gains against the yen.

While a sharp increase in the number of people giving up looking for work helped to depress the jobless rate, some details of the employment report were encouraging. The number of 'discouraged job seekers' rose to 1.1 million in January from 734,000 a year ago.

http://finance.yahoo.com/news/Payrolls-fall-in-January-rb-514835788.html?x=0&.v=2

"A sharp increase in the number of people giving up looking for work" translates into: we moved a bunch of unemployed people into a special category that we don't count in unemployment numbers TA-DA! Unemployment is magically now at 9.7%!

So... which do we want more:

[Political Heretic]

1. To the people replying that we want to spin the numbers for political purposes, a question:

If I figured this out, do you not think most people can figure this out? Do you not think American workers see through horse shit about unemployment?

Isn't it better to have the courage to be honest about the state of our union and more helpful in figuring out what to do about it?

I don't see what benefit comes from being dishonest about what the jobs report says and why it says it. It also feels like a slap in the face to those of us who are unemployed and desperately seeking, and to working class folks in general, living in daily fear of losing their job.

We sort of owe it to them not to play politics with their lives, no?

[AllentownJake]

2. I thought the deficit of trust line in the State of the Union was one of the best lines

and it appears it was empty political rhetoric. Sigh.

[NightWatcher]

3. the shit they are doing now is straight out of Orwell's 1984. Newspeak, anyone?

[DrToast]

4. Sorry, you're wrong

If you want the real facts, go to the report itself: http://www.bls.gov/news.release/empsit.a.htm

The labor force GREW from 153K to 153.1K.

The unemployment rate fell because the number of employed GREW from 137.79K to 138.3K.

[Political Heretic]

5. Payrolls dropped by 20,000. And the report itself SAYS unemployment drop due to classification.

Have you read it? Or did you just link it?

Because I decided to stay up and have been reading it. :hi:

[DrToast]

8. The link I posted shows the size of the labor force. Facts trump your opinion

Sorry, you're wrong.

The labor force increased in January.

I showed you the numbers.

Here they are again.

http://www.bls.gov/news.release/empsit.a.htm

As the saying goes, you're entitled to your own opinion, but you're not entitled to your own facts.

The labor force increased in January.

[Political Heretic]

10. It's not opinion. Doesn't matter how much you repeat it.

Payroll dropped by 20,000. That's a fact.

Thousands of unemployed were reclassified as "discouraged workers" - that is also a fact, written right into the report.

That is also a fact.

NSA-U3 unemployment is at 10.6% - that is also a fact.

NSA-U6 unemployment is at a staggering 18% - that is also a fact.

"Sorry the workforce grew" - doesn't really matter much to me, given these facts that are no zero dispute because they are written word for word in the report

[DrToast]

13. You're comparing data across two reports.

The 20,000 figure comes from the Payroll report.

The unemployment rate comes from the household survey. The household survey showed 541,000 more people employed. THAT'S why the unemployment rate dropped. The 20,00 figure isn't even used in the unemployment rate calculation.

(Again, all this information is right there in the link I posted for you. Read it. It's interesting.)

Stop cherry picking the numbers from the two reports to suit your argument.

[Political Heretic]

15. "comparing" data is fine when the data is independent, which it is. It's paralell.

We look at one report and see that payrolls declined again and by another 20,000. That tid bit of information stands alone.

Then we look to another report and see that SA-U3 unemployment dropped 0.3%.

We find that strange given the drop in payroll, but nothing about the payroll drop is connected to the calculation of the SA-U3 number, and no one ever said it was. But unless you are saying that one report is lying, we note the drop in payroll, and then examine the calculation of the unemployment number.

In examine the calculation of the unemployment numbers for last month, we see - plain as day, written right into the report, for anyone to see - that hundreds of thousands of workers were classified as "discouraged" and no longer counted in unemployment figures.

THEN, separate from those two things, which are independent of each other, we also note the NAS-U3 and NAS-U6 numbers which many argue are more accurate, because the manipulation of SA is so extreme, again in the opinion of some, - and we see that both rose dramatically.

THEN, we see that we are still dealing with horrific labor force participation rates, which is quite scary.

THEN, we see that even if you take SA-U6 numbers instead of NAS-U6 numbers, you still get an unemployment calculation of a staggering 16.5% - not exactly good times.

Sorry, but there's actually nothing wrong with comparing parallel data unless you are making calculations basic on data from both reports that are using different methods. I'm not doing that. So there's no problem.

[DrToast]

18. They're not parallel

Household report interviews people.

The establishment report surveys businesses.

The household report does a better job of picking up small business hires that aren't registering in the establishment report.

You are wrong. Again.

[Political Heretic]

19. Neither report depends on the other for its calculations.

This is the point that I'm pretty sure you are just deliberately ignoring.

[DrToast]

20. They're not measuring the same thing. Thus, you can't make comparisons across the two surveys

[Political Heretic]

21. Here's the opening sentence of the Labor Departments own release:

The unemployment rate fell from 10.0 to 9.7 percent in January, and nonfarm
payroll employment was essentially unchanged (-20,000), the U.S. Bureau of
Labor Statistics reported today. Employment fell in construction and in
transportation and warehousing, while temporary help services and retail
trade added jobs.

http://www.bls.gov/news.release/empsit.htm

Oh my god, that's like - exactly what I fucking said!

What you are not getting, and even the entire Labor Department disagrees with you on this one, is that the calculations for the payroll number have no connection to the calculations for unemployment and the calculations for unemployment have no connection to the calculations for payroll.

See? So when we look at one report and say? "Damn, payroll dropped." We are then allowed to look at another report and go "but hey, unemployment dropped too." We are actually allowed to read two different reports.

You're saying I'm making a comparison, and in my fucking sleep exhaustion, I said you can make "comparisons." What I meant was, you're allowed to read data from more than one report (obviously.) But I'm actually not comparing data calculations at all. There's no comparison between payroll and unemployment because they are apples and oranges.

The only thing you can say is that its wierd to have the indpendent measurement of payroll drop again and have the independment measurement of unemployment also drop. Those two independent measurements are very frequently found to be opposite of each other - one rises as the other falls. They are calculated independent of each other, sure, looking at different information. But they have a historical trend pattern. Thus you can consider that in parallel.

And every person in the universe writing about the numbers today is saying that very thing! Calling it "surprising" and "unexpected."

The only thing I'm adding to the mix is pointing out what is also written right into the Labor Department report, which is that the change in SA-U3 unemployment is due mainly to the reclassification of thousands of unemployed workers as "discouraged."

EDIT - I'll give you an example. If I took a number from the first report and then divided it with a number from the second report to come up with a number that I wanted to use, THEN you could question the legitimacy of doing so, saying those numbers came from two different reports measuring things in different ways and thus the output number is suspect.

You'd be completely right to make that criticism. But I'm not doing that. :)

[DrToast]

23. Are you for real?

You seem to be bringing up points that aren't in dispute. I guess that's all you got now that everything initially started with (thar numbers are fixxed!) has been disproven.

Keep on rambling if you want. I'm going to let this thread die the horrible death it deserves.

[Political Heretic]

25. Ah the age old cry of the thwarted

"Keep on rambling if you want. I'm going to let this thread die the horrible death it deserves."

Yeah, that's what everyone says when they realize they jumped to conclusions and tried so make hay out of something where there was nothing.

Are being shown to be idiotic, next comes the obligatory "whatever man, I'm going to let this thread die."

You seem to be bringing up points that aren't in dispute.

Interesting. Only bringing up the points you disputed, that somehow mentioning the loss of 20k payroll being strange given the drop in unemployment, and then mentioning the cold, hard, explicitly stated in the labor departments own summary fact that the 9.7% unemployment rate was due in large part to the shift of several hundred thousand unemployed persons into the category of "discouraged worker" - thus no longer counted.

None of this is in any sort of dispute. None of it. You know it. I know it. The Labor Department knows it (since they fucking wrote it and said so.) DU readers know it. Which is why you delivered the classic, "whatever I'm going to let this die" line.

[Political Heretic]

6. Further proof: NSA-U3 is 10.6%! NSA-U6 is 18% - EIGHTEEN PERCENT

Both up from last month, and record breaking.

Do you need me to explain those numbers to you?

[DrToast]

9. Do you need me to explain why numbers are seasonally adjusted?

Have you ever heard about this thing called Christmas? And how there's always a hiring surge before it and firing surge after it?

Did it ever occur to you that there might be some benefit in removing those wild swings from the equation to get a better picture of the labor market?

[Political Heretic]

11. Did it ever occur to you that NSA numbers are more difficult to game?

Now who's talking about OPINION?

[Jim__]

7. Alternative measures of unemployment for January 2010.

Here

I'd post the table here, but I can't get it to post in a readable format.

[NNN0LHI]

12. Boy, you seem really invested in the unemployment numbers going up?

Huge fecking graphs, polls, a sense of hysteria. WTF is your agenda?

Short seller or what?

Jeez.

Don

[DrToast]

14. LOL...seriously

[apocalypsehow]

54. Your opinions -and that's what they are- are not credible. Find something new to "LOL" about. n/t.

[Political Heretic]

16. It's very simple. I can't stand how employment / unemployment is lied about in this country.

I can't stand how unemployment is officially reported in this country. I can't stand how unemployment data is manipulated to make whatever party or politicians are in the hot seat look better. I can't stand how corporate media almost never reports anything but the most distorted and weakest of employment numbers from the BLA - the SA-U3.

It makes me sick.

And I believe, in my opinion, that the country would be in better shape if we spend more time trying to get accurate data, and demand that our politicians own that accurate data and set policy priorities accordingly.

Not only that, but I just hate it when people lie to me. I want accuracy - even if it doesn't benefit the right "team." I care more about accuracy than just about anything else.

[branders seine]

17. rah rah ree

hit 'em in the knee

[Subdivisions]

22. Yesterday it was being reported that we were at 10.1% UE. Now, today,

we're being told it's 9.7% UE. And that figure doesn't count the thousands (and thousands, apparently) who have given up looking for a job.

We are so totally played by TPTB in this country and they'll do anything to keep us from knowing the truth about the whole picture.

[lumberjack_jeff]

24. Spin.

Dissatisfaction persists: healthcare reform fails, bank regulation fails. Republicans get elected and make it even worse.
Dissatisfaction levels off: healthcare reform wins, bank regulation wins. Democrats get elected and make marginal, gradual improvements.

I pick b.

Self deception? No, I can read the actual numbers as well as you. I want to deceive the dumbshits.

[Political Heretic]

26. We need dissatisfaction to be targeted where it belongs

on obstructionists and the financial elite.

Nothing wins if the people are comfortable and complacent. The problem has been the failure of the Democrats to create narrative and focus public anger toward the right enemies.

And believe me, lying to people isn't the way to get dissatisfaction to level off.

[lumberjack_jeff]

39. Worked for Reagan.

Who am I to argue with success?

Americans aren't smart enough to blame the right people. They blame the guy on TV.

[Political Heretic]

44. The only thing that's ever brought substantive change IS people.

Your blame the people attitude is at odds with the history of radical change.

And I'm not sure why anyone should consider you not one of the people. Why are you somehow special and set apart from the "stupid Americans?"

I'll stand with the people you write off any day.

[lumberjack_jeff]

45. A) because I supported McGovern, Mondale and Dukakis.

B) If you think Reagan and his supporters didn't change the world, you seriously misread history.

"A" certainly suggests I'm not one of the people. And "B" proves that changing the world is not solely the province of smart people.

[laughingliberal]

30. Even dumbshits can tell if they have a job or not. nt

[WCGreen]

27. I don't know if anyone else posted this but could those

20k jobs have been temporary jobs that ran their course because of the holiday season...

[treestar]

28. A certain amount is psychological

If people don't hang onto their money because they are afraid they will lose their job - the economy would be stimulated and improve.

So I am wondering what is the agenda of anyone who wants us all to believe there will be no recovery and in fact it will get worse?

With so many DUers unemployed, who is it that would want to discourage them? What result do they expect?

What about the self employed? They have not become unemployed, but see revenues down. What is the point of discouraging them that things are getting worse?

What is the reason for trying to keep everyone pessimistic and discouraged? What good does that do? Why would one want to do that to others?

[laughingliberal]

31. Truth is a good motive for some of us

I'm unemployed and it wouldn't matter to me, personally, if the numbers said the unemployment rate is 4%. Until it shows up in the classifieds for this area or until my husband's business starts getting calls from paying customers. I remain discouraged no matter. I prefer to know the real numbers aside from how it affects me emotionally.

If things really are getting worse, why would you want to hide that? What about the guy trying to decide if he should pay the rent on the shop another month?

"Honey, unemployment's down. Let's keep the shop open. Things will break in the Spring."

Spring time: "Well, no new work coming in. Sure wish we had shut it down and saved those operating expenses for food and stuff."

I'm a former hospice nurse. There's a place for hope but false hope is harmful.

edited punctuation

[treestar]

34. But on the economy no one can know the future for sure

So defaulting to optimism is always better, since that psychological element is there.

And in the past we have always recovered, pure capitalism even would do that.

I would not even think of closing down - not unless I had a failed business of the type that would be closed in a good economy even, just because it was not a good business) and would never so do based on people saying an improved unemployment rate was still sign of complete doom.

[laughingliberal]

36. Defaulting to optimism has cost us a fortune the past year and a half

We've held on to a house we needed to let go of hoping to see the business pick up so we could keep it long term. The business has not recovered and we now have to let the house go. Wonder how much better off we'd be if we hadn't been trying to crack that $1500 a month mortgage waiting for the turn around?

I guess since it's not your business we're talking about we'll just have to decide for ourselves. My husband has been in business and profitable since 1982. He turned a profit the first year and every year until the last 2 years. This is not a business that would close down in a good economy (or even in a few bad ones through the years). But it is failing now due to the collapse of the housing market and the high number of unemployed people who have no money to spend on our services.

edited punctuation

[Political Heretic]

33. The more awake people are to how bad it is the more public outrage turns into action

FDR didn't come into office a flaming liberal. His political history up in New York had been economically conservative in point of fact.

It was in large part the actions of the people, in the streets, outraged, forcefully - sometimes even too forcefully (riots in most major cities) - demanding dramatic change, that caused FDR to move as he did.

To me, truth and honesty is power.

[treestar]

35. People are not going to riot in the cities

during this recession, especially when things are getting better. No one wants it to get that bad.

[Political Heretic]

41. I do.

Because I believe that's the kind of change we need.

[treestar]

62. That's wrong

People would suffer. Real people. It's wrong to hope things will get worse on a political point.

[laughingliberal]

38. Yeah, but as long as the TV stays on and American Idol is starting another season

Go team. Never mind the economic trajectory for the working class has been headed down for 30 years. As long as the house of cards remains standing for some it will be ignored.

[RoyGBiv]

29. I want consistency ...

... and I want perspective.

The most objective assessment of today's numbers I can imagine is that things are stagnant, the jobs situation remains very bad, and that little to nothing is being done to improve the situation. It's not significantly worse than it was the month before or the month before that, nor is it any better. The only "positive" in today's numbers involves signs that the "trend" shows improvement, which is to say it's not really getting any worse at the moment. Stagnant, as bad as it is, is actually better than getting worse, not that this means anything to people who remain unemployed.

But the problem is that we've had this narrative foisted upon us by various critics and the critics of critics that the month-to-month numbers must be interpreted in one of two extreme ways. We've implicitly accepted this narrative as valid and so respond within that framework.

[Political Heretic]

32. I don't just want consistency, I want transparency, accountability and accuracy.

Thus, to me, it is a big deal with the primary reason why the media reports a "drop" in unemployment is because thousands of out of work Americans were simply rendered "invisible" with the stroke of a pen.

To me, that's sick.

And yes, this happens all the time - I understand that. But it doesn't anger me any less. I don't think its accurate to call something an "unemployment" number and then hide a bunch of unemployed people.

It is something I believe we need to change in our system.

Incidentally, depending on what numbers you look at, it either stagnant (I agree with your characterization of the 0.3% change in SA-U3 numbers) or must worse (NSA-U3 and NSA-U6 numbers, both breaking records).

What we should all be able to agree on is that things aren't looking so hot right now. And it appears we have a long way to go.

[RoyGBiv]

47. And I do agree with that ...

I at least think we can also agree that Congress has failed utterly to address jobs in a meaningful way beyond stop-gaps enacted rapidly, and at too small a level, early in 2009. The Fed has washed their hands of the issue while playing a political game it pretends not to play, and while the Obama administration has said some of the right words, internally there are competing ideological visions, leading to administrative stagnation as well.

I do have a quibble with the "much worse" characterization of the NSA numbers. I think this is more of an indictment of how these numbers, specifically the SA numbers, are calculated. They'll even out in a month or so, provided nothing dramatic changes things for the positive or negative, which, I think, will in the end show the 0.1 or 0.2 increase in the unemployment numbers many were expecting.

[Political Heretic]

51. Agreed - with one caveat

As far as the "much worse" characterization goes,

The gap between NSA and SA numbers will hopefully even out, however its the U6 number that I care about the most.

A quick story:
Tonight I'm watching the local news, and the reporter says, "New Unemployment numbers were released today showing that unemployment fell in January to 9.7%." That was essentially the entire comment on unemployment.

I think that's a travesty. I think its misleading to not point out that the number being used to calculate unemployment is one of six possible choices that could have been used...

and that of those six choices, one of two specific variants was chosen...

and the variant chosen does not count workers classified as "discouraged" of which there are a new 138,000 (and if those workers were counted it would cut the drop in unemployment registered by the household data effectively in half (50%)...

and the variant chosen does not include workers who need full time employment, want full time employment and are eligible to work full time who cannot find it (but are attached to some form of part time work)...

and the variant chosen does not include workers called "marginally attached" who need full time employment, want full time employment and are eligible for full time employment but who haven't filled out job applications every week or month.

The reporter could have just as credibly said "New unemployment numbers were released today showing that unemployment rose to 18% in January."

Because without providing any context for either 9.7% or 18% both statements are disingenuous.

As a social worker, I have a passionate opinion about the value of U6 employment numbers (SA or NSA.) I've finally had sleep now, so I can explain my definition of "accuracy" better than I did this morning.

There is no question in my mind that "accuracy" is relative. A work like "accurate" must be followed by a phrase like "..in describing x." I think we agree on this.

For me, I want the number of people who need full time employment, who want full time employment, and who are eligible for full time employment to be fully counted. I want a number that doesn't start excluding people based on judgments about whether or not they are "looking hard enough" or whether or not they really "want work." I want a number that does not exclude people who have lost hope, and are living in the despair of poverty and joblessness with no end in sight, when those people would still want full time employment even if they've lost hope in finding it.

The social worker in me believes that all the exclusions and stipulations of a U3 number serve to make the harsh reality of conditions on the ground in working America. So when I say "accuracy," I mean "accuracy in describing the fullest conditions of lacking full time employment but desiring full time employment in America today."

I think a number like that is the most important number our society could care about, much more important that the softer U3 number. If the public were presented an unemployment number that showed the national average at 16.5% or 18% - with regions of unemployment topping 20% - even if you carefully disclosed all the details of how those numbers are generated, American people would have a much different attitude toward the responsibilities and actions of our elected representatives.

Half-hearted stimulus, half-hearted jobs bill proposals and full-hearted upward wealth-transfers to Wall Street might be seen with righteous fury. People might be shaken out of either complacency (among the less hard hit upper middle class) or despair (among the ravaged poor and working class) and take to the streets.

It was this kind of popular awakening and outrage that pushed FDR to the left, away from his centrist and economically conservative political history. And it didn't happen from day one of his first term. He was pushed there by a combination of the terribly reality of the situation and the active, engaged, outrage of a public that would settle for nothing less but structural revolution of our political and economic system.

We need that again today. And any numbers that try to soft peddle where we're really at with this economy are numbers I disdain. It has nothing to do with like or dislike of the Administration. I believe the burden is on we the people to make our representatives do what we want, change representatives who won't, or change the system itself it its limits prevent us from ever having representatives who do our bidding.

[RoyGBiv]

61. We don't disagree then ...

I'm glad we could straighten that out.

I'm sure we don't agree on all the details of the approaches to be taken to address these problems, nor all the reasons for them, but I'm not so concerned about disagreements on detail. If a solution works, I don't really care if one detail isn't in line with some other detail I consider more important or relevant.

[hfojvt]

37. if you are gonna report 'the truth'

it would be nice if you looked at the actual report, rather than a second hand report from the M$M.

For one thing, the article you quoted does not say that the number of discouraged workers grew in January. It compares this January to last year, rather than comparing it to December.

[Political Heretic]

42. We can now see who hasn't read the acutal report.

Since the actual report itself identifies the change in unemployment as related to the number of workers moving to the discouraged category.

http://www.bls.gov/news.release/empsit.a.htm

The number of discouraged workers grew in January.

[hfojvt]

46. first, I am not the one making claims

I only noted that the ARTICLE you quoted compared last year to this year, not last month to this month. I was behind the curve in that you were arguing with DrToast over the report upthread, but I never claimed that I had dug into the report.

However, reading your link does not lead me to think that "the unemployment drop is bogus"

According to that very link, the labor force grew by 111,000 and the number of discouraged workers grew by 136,000 but it also says that the number employed grew by 541,000 and the number of unemployed fell by 430,000.

So I guess this proves your point that it is really all bad news for the economy and we shouldn't believe Obama administration spin about supposed good news?

It also says that the number of people working part-time fell by 849,000. (meaning they went from part-time to full-time, another little bit of GOOD news).

So, are you telling the truth, or looking for ways to spin this against the Obama administration and the Democratic Party? Because the truth looks pretty good from where I sit.

Granted it is counter-intuitive how a 20,000 loss translates into lower unemployment, but it comes from two reports. The household survey never matches with the establishment survey and the household survey is showing a gain and that's where the unemployment rate comes from.

[Political Heretic]

49. You've made several mistakes here.

However, reading your link does not lead me to think that "the unemployment drop is bogus"

According to that very link, the labor force grew by 111,000 and the number of discouraged workers grew by 136,000 but it also says that the number employed grew by 541,000 and the number of unemployed fell by 430,000.

As I said before, The Household report may say that the labor force grew by a underwhelming one tenth of one percent (0.1) but it also says that 136,000 workers were reclassified as "discouraged" this month, up from December. When that number is factored in, it cuts the unemployment number nearly in half.

Yes, I'm aware that this is how the BLS always calculates unemployment, which is why, contrary to your claims, I didn't start a thread bashing the Obama administration. My problem is with the way unemployment is calculated so as to give politicians the lowest possible unemployment numbers to talk about. And I'll come back to this later.

Also, it's important to understand the context of the 541 number in relation to the population adjustment process that happens this month:

Adjustments to Population Estimates for the Household Survey

Effective with data for January 2010, updated population estimates have been
used in the household survey. Population estimates for the household survey
are developed by the U.S. Census Bureau. Each year, the Census Bureau updates
the estimates to reflect new information and assumptions about the growth of
the population during the decade. The change in population reflected in the
new estimates results primarily from adjustments for net international migra-
tion, updated vital statistics and other information, and some methodological
changes in the estimation process.

In accordance with usual practice, BLS will not revise the official household
survey estimates for December 2009 or earlier months. To show the impact of
the population adjustment, however, differences in selected December 2009 labor
force series based on the old and new population estimates are shown in table B.
The adjustment decreased the estimated size of the civilian noninstitutional
population in December by 258,000, the civilian labor force by 249,000, and
employment by 243,000; the new population estimates had a negligible impact
on unemployment rates and other percentage estimates. Data users are cautioned
that these annual population adjustments affect the comparability of household
data series over time. Estimates of large levels, such as total labor force and
employment, are impacted most. Table C shows the effect of the introduction of
new population estimates on the changes in selected labor force measures between
December 2009 and January 2010. More detailed information on the population
adjustments and their effect on national labor force estimates are available at
www.bls.gov/cps/cps10adj.pdf.

Now back to you:

It also says that the number of people working part-time fell by 849,000. (meaning they went from part-time to full-time, another little bit of GOOD news).

That's incorrect. It does not necessarily mean they went from part-time to full time employment. That can move from part-time to not-looking for work by choice, or to discouraged from looking for work. Seasonally Adjusted vs. Non-Seasonally adjusted numbers both try to deal with the December-January reality of numerous part-time jobs being created and then ended during the holiday season, with job holders not necessarily moving to full employment (they may not look for further work, this is true of million and millions of college students for example.)

I'm not suggesting that no people moved to full employment. But its not a direct connection from falling part-time numbers to full employment, especially in the month of January.

Granted it is counter-intuitive how a 20,000 loss translates into lower unemployment, but it comes from two reports. The household survey never matches with the establishment survey and the household survey is showing a gain and that's where the unemployment rate comes from.

That is also incorrect. There is frequently, in fact usually, a connection between establishment survey's information on payroll and an opposite effect in household unemployment numbers.

There's something else very important: there's a reason why the Labor report cited the payroll statistics when talking about employment in its monthly report rather than the household data's information on employment: because for month to month evaluations, one of the strengths of the establishment data is that it is much more accurate and has a much larger sample size.

Don't take my word on that:

Frequently Asked Questions about Employment and Unemployment Estimates


Why are there two monthly measures of employment?

The household survey and establishment survey both produce sample-based
estimates of employment and both have strengths and limitations. The
establishment survey employment series has a smaller margin of error on
the measurement of month-to-month change than the household survey because
of its much larger sample size. An over-the-month employment change of
107,000 is statistically significant in the establishment survey, while
the threshold for a statistically significant change in the household sur-
vey is about 400,000. However, the household survey has a more expansive
scope than the establishment survey because it includes the self-employed,
unpaid family workers, agricultural workers, and private household workers,
who are excluded by the establishment survey. The household survey also
provides estimates of employment for demographic groups.

Again, back to you:

So, are you telling the truth, or looking for ways to spin this against the Obama administration and the Democratic Party? Because the truth looks pretty good from where I sit.

People just can't get this through their heads, can they. I could care less about making the Obama administration "look" good or bad. I care about one thing only here: the way in which BLS are used is misleading and consistently misrepresents the true state of unemployment in the United States.

There are six different employment numbers - U1 through U6, with U1 being the most narrow and U6 being the most inclusive. When the media reports on "unemployment" you would think they would use the most inclusive number, same with political administrations.

The U6 number includes classifications of unemployed workers that I believe are critical when trying to really understand where unemployment is at. "U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force"

"NOTE: Persons marginally attached to the labor force are those who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the past 12 months. Discouraged workers, a subset of the marginally attached, have given a job-market related reason for not currently looking for work. Persons employed part time for economic reasons are those who want and are available for full-time work but have had to settle for a part-time schedule. Updated population controls are introduced annually with the release of January data."

Now - that is a real unemployment number. One that represents people willing and able to work, but who can't find work. I wish the U6 number included discouraged workers too, because these are people who are willing and able to work but have given up hope of ever finding work and I believe they should be included. But they aren't.

Okay are you still with me? Then for the U6 number we have two different calculations, first we have the non-seasonally adjusted U6 number (NSA-U6) - this number is the straight-up results of survey data. Then we have the Seasonally-adjusted U6 number (SA-U6) - this number is arrived at via a special statistical formula that makes guesses and tries to compensate for the reality of short-term holiday jobs that disappear again after the holidays.

I believe that the NSA number ends up being more accurate than the SA number in many instances, because the calculation applied to calculate the seasonal adjustment leaves something to be desired. Further, there are far less ways to try and "game" non-seasonally adjusted numbers. They just say what they say. But both SA and NSA numbers are important, and should probably be considered together. So let's look at them.

These are the statistics that I think are most important:

FIRST - Civilian Particpation Rate Doesn't Look Good At All

Even though there is a 0.1 positive change in this rate in January, its a scary, scary number and things are currently not looking up. We want to know this so that we can continue to be serious about the kind of dramatic action we need on the economy. Now is not a time when we can play it safe with "middle of the road" economic recovery legislation.

SECOND - SA-U6 Unemployment at a Staggering 16.5%, But down 1% from December.

It is true that there's a 1% downward shift in unemployment to a still stunning 16.5% level, if one uses the special calculation to provide a "seasonal adjustment." What I believe we should take aware from this number, even with a 1% drop is that we are in the middle of a deep crisis. We are not in "recovery." The economy is not "strong." And its not a slam on the adminsitration to say that.

But we must demand that our administration take bold serious action to make deep spending investments into this situation, and right now they aren't doing that. They are trying to straddle the fence - worried about how deficit spending will effect their 2010 elections. We need to strongly push our leaders to do more.

THIRD - NSA-U6 Unemployment Numbers Rose to a record setting 18%

I argue that NSA numbers are the hardest to manipulate and "game" and thus come closest to what I believe a real picture of "conditions on the ground" in working America actually look like.

However, even if one disagrees with that, then the fact remains that the Seasonally Adjusted U6 numbers are also abysmal.

So either way, my point stands - unemployment is, as usual, worse than what is reported in the mainstream and we must continue to forcefully demand that our representatives pass aggressive, sweeping spending on jobs and infrastructure in order to pull us out of this spiral and not set us on course for a decade long jobless recovery.

If you read "OMG I H8 OBAMA!!!1" into that, you're the one being ridiculous, not me.

[quiller4]

40. Actually, a good number moved from the work force to retirement

too and as more boomers retire, that creates openings for others. Even when layoffs continue much hiring is taking place.

Both my spouse and I retired early. We have many friends who had planned to retire in 2008 or 2009 who delayed their retirement when the stock market tanked and their home values dropped. In our area, home values in our area have been rising since early summer. You are know how much the market has recovered. Just in our small circle, I can name more than 20 people who have retired since November.

My sister-in-law works in HR for a large firm. She told me last week that she has processed more retirements in the last two months than she had in the previous three years.Her firm is actively encouraging retirements by offering golden parachutes to employees over 55 that include providing up to 24 months of employer paid health insurance.

Getting more boomers to retire early would help the employment numbers. That is one of the reasons I so supported the Medicare buy-in option that surfaced late last year. For many in my age group the primary barrier to early retirement is access to health insurance. Many of us simply cannot purchase in the individual market at any price because of previous health conditions but we could buy in to Medicare even at market rate.

[Political Heretic]

43. That speculation is not substantiated by the jobs report today

http://www.bls.gov/news.release/empsit.nr0.htm

[county worker]

48. I heard the real explanation on NPR this morning.

The unemployment numbers and the job loss numbers come from different places. You can't make your assumptions as you do.

[Political Heretic]

50. Sigh. I'll provide reference to previous explanations, but what you say is not correct.

I've discussed this ad nausem. I understand why you think that, but it just simply isn't so.

See this:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x7645394#7645893

And this:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x7645394#7651683

And then also, though this is a different argument, its related:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x7645529

[Edweird]

52. I would rather there be no talking and a lot of fixing. A new 'new deal' is sorely needed..

but is not coming.

[FrenchieCat]

53. A graph is good.

[Political Heretic]

58. That graph is great if you want to compare jobs under 2 different administartions.

If you want to talk about what's wrong with how we report unemployment, as I do, then the graph is irrelevant to this particular discussion.

:shrug:

[old mark]

55. I vote for reality. Behind all the numbers are actual people losing

everything they have worked for. Their misery far outweighs any perceived political gain from faking some publicity. We must FIX the problems, not ignore them or just improve their appearance - we are not republicans, and we shouldn't adopt their delusional "thinking".

rec.

mark

[Zynx]

56. I wish people wouldn't shout conspiracy. Statistical measurement of the economy is not an

exact science. There is a great deal of measurement error and beyond that the models they use to approximate data have fairly large confidence intervals. Stuff like this happens quite a bit with data.

[Political Heretic]

57. I don't believe anyone has shouted conspiracy.

unemployment numbers have been calculated like this for a long time. That doesn't make them any better, but it doesn't make it a clandestine conspiracy either.

What's being discussed is a very specific practice of disappearing a bunch of people so that they're not counted. It's a lame thing to do based on some notion that they don't deserve to be counted because "they're not looking hard enough."

That doesn't have anything to do with confidence intervals. Yes, I know what that is. I've been through grad stats.

[Zynx]

60. There's a reason for putting them in that category.

If the job market turns around and people start finding jobs who are looking for them, it doesn't make sense to include people who are not making an effort in this particular measure. Other measures exist that do track them, including U-4 and U-6. If your complaint is that this is the only number that makes headlines, then that's fine.

[blindpig]

59. Really amazing..

the unrec's, that is.

With all of these ostriches we could have a killer 'fan dance'.