Post by unlawflcombatnt on Jan 4, 2008 18:22:47 GMT -6
Today's Payroll Employment report was much worse than the "experts" predicted. Non-Farm 18K in December, much less than the 70K predicted. But the actual "count-able" employment was much worse. The BLS's business birth/death model added 66K jobs to the total. These 66K come from BLS guesstimates as to how many jobs were created that could not be counted. (i.e., they are virtual jobs that bear have nothing to do with reported payroll numbers.) Most economists agree that the birth/death model overstates jobs created when the economy is contracting. Without the addition of the birth/death "virtual" jobs, nonfarm payroll employment would have declined -48K. Below is a copy of the today's business "birth/death" model from the Bureau of Labor Statistics (BLS).
The Household Survey results were MUCH worse than those from the Nonfarm Payroll Employment report. The Household Survey showed a 1-month decline in Total Employment of -436K. Though this number does fluctuate wildly from month-to-month, it has the advantage of covering ALL employment. The year-over-year comparison, however, eliminates most of the month-to-month fluctuation. In the 12 months from December 2006 to December 2007, Total Employment increased only 262K. This an average of 22K/month. (150K jobs are necessary to keep up with population growth.)
The Household Survey shows a working age population growth of 3,048,000 over the last year. This means the working age population grew almost 2.8 million more than the number of jobs created. Not surprisingly for this government, the bulk of this growth was put into the "Not-In-Labor-Force" category—which increased 1.9 million. This reduces the unemployment number and the rate, as those "Not-In-Labor-Force" are not counted. (Only those classified as being in the "participating" labor force are counted.)
However, even with the not-in-labor-force connivery, the unemployment rate increased to an "official" 5.0%. This is an official increase of +0.6% over the last year. However, had the same Labor Force Participation Rate (which means Participating Labor Force ÷ Working Age Population) been used as was in December 2006 (66.4%), instead of the current downwardly-manipulated 66.0%, the official Unemployment rate would have increased to 5.6%, instead of 5.0%. Using the 66.4% rate would have increased the participating labor force to 154.815 million (instead of the currently stated 153.866 million.) This would have increased the number classified as Unemployed by 950K — increasing the Unemployment number to 8.605 million from the current 7.655 million. Calculating: 8.605 million ÷ 154.815 million = 5.6%.
Below is a partial copy of the current 1-page Employment summary from the BLS.
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Below are the links to the graphic information above:
Birth/Death Model
www.bls.gov/web/cesbd.htm
BLS 1-Page Employment Summary
www.bls.gov/web/cpseea1.pdf
The Household Survey results were MUCH worse than those from the Nonfarm Payroll Employment report. The Household Survey showed a 1-month decline in Total Employment of -436K. Though this number does fluctuate wildly from month-to-month, it has the advantage of covering ALL employment. The year-over-year comparison, however, eliminates most of the month-to-month fluctuation. In the 12 months from December 2006 to December 2007, Total Employment increased only 262K. This an average of 22K/month. (150K jobs are necessary to keep up with population growth.)
The Household Survey shows a working age population growth of 3,048,000 over the last year. This means the working age population grew almost 2.8 million more than the number of jobs created. Not surprisingly for this government, the bulk of this growth was put into the "Not-In-Labor-Force" category—which increased 1.9 million. This reduces the unemployment number and the rate, as those "Not-In-Labor-Force" are not counted. (Only those classified as being in the "participating" labor force are counted.)
However, even with the not-in-labor-force connivery, the unemployment rate increased to an "official" 5.0%. This is an official increase of +0.6% over the last year. However, had the same Labor Force Participation Rate (which means Participating Labor Force ÷ Working Age Population) been used as was in December 2006 (66.4%), instead of the current downwardly-manipulated 66.0%, the official Unemployment rate would have increased to 5.6%, instead of 5.0%. Using the 66.4% rate would have increased the participating labor force to 154.815 million (instead of the currently stated 153.866 million.) This would have increased the number classified as Unemployed by 950K — increasing the Unemployment number to 8.605 million from the current 7.655 million. Calculating: 8.605 million ÷ 154.815 million = 5.6%.
Below is a partial copy of the current 1-page Employment summary from the BLS.
_______________
Below are the links to the graphic information above:
Birth/Death Model
www.bls.gov/web/cesbd.htm
BLS 1-Page Employment Summary
www.bls.gov/web/cpseea1.pdf