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The economy added 225,000 jobs in January, showing continued strength
Source: Washington Post
The U.S. economy added 225,000 jobs in January, surpassing analysts predictions in a sign of continued growth for the economy. The unemployment rate ticked up slightly to 3.6 percent, remaining near a 50 year low.
Job gains picked up in construction, health care, as well as transportation and warehousing, according to the Bureau of Labor Statistics.
The number of jobs added for the month was well above the average of 176,000 jobs per month in 2019, and 223,000 in 2018. In 2019, the U.S. added 300,000 jobs in January, an impressive uptick that federal statisticians surmised had spiked because of the government shutdown as people took on part-time jobs.
Business experts had expected a more modest monthly total, saying it was inevitable with the economy’s long expansion. January was the 112th straight month of job growth since 2010 and many analysts predicted the total would be around 150,000 or 160,000.
Read more: https://www.washingtonpost.com/business/2020/02/07/february-2020-jobs-report/
A lazy headline but will await the update and our resident DU economy watchers for the details!
Original article and headline -
The U.S. labor market remained strong in January, adding 225,000 jobs
By Washington Post Staff
Feb. 7, 2020 at 8:33 a.m. EST
Business leaders and politicians are watching the jobless rate closely, as concerns about a possible recession have eased.
This is a developing story. It will be updated.
https://www.washingtonpost.com/news/business/wp/2020/02/07/the-u-s-labor-market-remained-strong-in-january-adding-225000-jobs/
By Washington Post Staff
Feb. 7, 2020 at 8:33 a.m. EST
Business leaders and politicians are watching the jobless rate closely, as concerns about a possible recession have eased.
This is a developing story. It will be updated.
https://www.washingtonpost.com/news/business/wp/2020/02/07/the-u-s-labor-market-remained-strong-in-january-adding-225000-jobs/
53 replies
= new reply since forum marked as read
= new reply since forum marked as read
that this avalanche of "great" economic news is somewhat suspect coming from the Trump administration at this time? 
Six months ago there were nothing but signs that the economy was slowing, and many economists were predicting a recession. I guess it's a sign from "heaven" that suddenly the economy is going through the roof again because of the Orange Shit-Stain's solid economic policies. 
I smell more TrumpCo. lies and obfuscation. I trust NOTHING that comes from these lying scumbags.
G.W. Bush inherited an economy from Clinton that had 4 budget surpluses in a row)
{#} ACTUAL Federal Spending and Deficits - Fiscal Years 2008 - 2019, in $Billions
Fiscal year 2019 ended September 30, 2019. Similarly for all the other fiscal years.
Note: all figures in this section are actual, not budgeted. I only point out that Bush signed the FY 2009 budget, and that Obama signed the FY 2017 budget.
And yes, the above numbers include payroll tax receipts (including Social Security) and Social Security benefits expenditures, since the above are unified budget numbers.
Source:
. . . https://www.cbo.gov/publication/55824 which links to the complete document at
. . . https://www.cbo.gov/system/files/2019-11/55824-CBO-MBR-FY19.pdf . . . See also
. . . https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/budget/fy2018/hist01z1.xls
. . . https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/budget/fy2019/hist01z1.xls <-does not work 2/3/20
. . . (Table 1.1) for receipts, outlays, and surplus
. . . . . . https://www.whitehouse.gov/wp-content/uploads/2019/03/hist01z1-fy2020.xlsx
(Historic tables are listed at http://www.whitehouse.gov/omb/budget/Historicals ).
Source for the 2008 numbers (and 2009 thru 2012 except a couple of the later years were revised by the document above):
. . . http://www.cbo.gov/publication/43698 which links to the complete document at
. . . https://www.cbo.gov/sites/default/files/112th-congress-2011-2012/reports/43698-Nov-MBR.pdf
Aside: how it was spent (good read): https://www.cbpp.org/research/policy-basics-where-do-our-federal-tax-dollars-go
Regarding Obama's 8 years: FY 2017 federal spending is 463 B$ (13.2%) more than FY 2009 (the last Bush budgeted year).
Since the nominal (current dollar) GDP increased by 35.5% between FY 2009 (a recession low point) and FY 2017 (see next paragraph), while federal spending increased 13.2%, that means federal spending as a percentage of GDP dropped substantially during those 8 years -- from 24.46% of GDP to 20.42% of GDP (calculations below). Something to keep in mind when some rightie rants and raves about the socialist Obama spending us into the poor house.
Note: I am including FY 2017 as part of Obama's legacy because he signed the FY 2017 budget spending bills. FY 2017 runs from Oct. 1, 2016 thru Sept. 30, 2017 -- 3 2/3 months while Obama was president, and 8 1/3 months while Trump was president). Just like I assigned FY 2009 to Bush
In Current Dollars: GDP FY 2009 (2009 Q3) = $14,384.1 billion . GDP FY 2017 (2017 Q3) = $19,495.5 billion -- an increase of 35.5% over FY 2009.
Source of GDP figures: http://www.bea.gov/national/xls/gdplev.xls
where FY 2009 = Q4 2008 through Q3 2009. And FY 2017 = Q4 2016 through Q3 2017.
FY 2009: Spending / GDP = 3518/14384 = 24.46% . FY 2017: Spending / GDP = 3981/19496 = 20.42%
The Fiscal Year 2009 budget (Oct. 1, 2008 - Sept 30, 2009) was signed into law by G.W. Bush. The CBO on January 7, 2009 (13 days before Bush left office) projected a $1.2 trillion deficit for FY 2009. So all but about $200 billion of FY 2009 spending and deficits was "baked in" before Bush left office.
Link to tweet
Catherine Rampell ✔@crampell
post-benchmark revision, monthly job growth in the first 37 months of Trump's presidency has averaged 182,000.
In the last 37 months of Obama's presidency, it averaged 220,000.
9:19 AM - Feb 7, 2020
thanks G.W. Bush! who handed Obama an economy that was losing hundreds of thousands of jobs a month.
Details and sources in this thread at https://www.democraticunderground.com/10142430036#post21.
And it is going up, and will undoubtedly end FY 2020 at over $1 trillion
https://www.democraticunderground.com/111622439#post5
I hope you find more useful stuff there. And yes, in the media and social media, there's a lot of mixing of debt and deficit. One thing though that's easy to remember: ever since the Clinton budget surpluses, the national debt has been increasing every year. (I think even in some of the Clinton budget surplus years the national debt actually increased because of the way the Social Security Trust Fund is accounted for IIRC. But all four Clinton surpluses were true surpluses -- revenue exceeded spending in all four years).
Oh, that EF-5 page explodes another RepubliCON myth: that Obama doubled the Bush deficit. (it never ends....
)
I hope you find more useful stuff there. And yes, in the media and social media, there's a lot of mixing of debt and deficit. One thing though that's easy to remember: ever since the Clinton budget surpluses, the national debt has been increasing every year. (I think even in some of the Clinton budget surplus years the national debt actually increased because of the way the Social Security Trust Fund is accounted for IIRC. But all four Clinton surpluses were true surpluses -- revenue exceeded spending in all four years).
Oh, that EF-5 page explodes another RepubliCON myth: that Obama doubled the Bush deficit. (it never ends....
)
Last edited Thu Apr 9, 2020, 02:27 PM - Edit history (3)
For everyone who thinks the BLS is just making this stuff up, there's contact information in here. You can write them and let them know you're on to them.
Last edited 12:15 p.m., Monday, February 10, 2020.
I used to run this every month in the commentary in the zeroeth post. It explains just about every aspect of the monthly report.
[center]Facilities for Sensory Impaired[/center]
Information from this release will be made available to sensory impaired individuals upon request. Voice phone: 202-691-5200, Federal Relay Services: 1-800-877-8339.
[center]Introduction[/center]
Good morning, Freepers and DUers alike. I especially welcome our good friends from across the aisle. You're paying for this information too, so I am absolutely delighted to have you participate in this thread. Please, everyone, put aside your differences long enough to digest the information. After that, you can engage in your usual donnybrook.
Full disclosure: I do not work for BLS, nor am I friends with anyone over there. I'm just someone who appreciates the work they do. My sole connection with the agency is that I've been in the building to pick up some publications.
Thank you for being a part of this thread.
If you don't have the time to study the report thoroughly, here is the news in a nutshell:
Commissioner's Statement on The Employment Situation
It is easy to find one paragraph, or one sentence, or one datum in this report that will support the most outlandish of conclusions, from "the sky is falling" to "we'll have blue skies, nothing but blue skies, from now on." Easy, but disingenuous.
Every month, you can find something in the report that will cause you concern. Take the information in context. Consider not just this month’s data, but the trend.
Please take the time to look at progree's thread. Here is the latest version, updated on Sunday, February 9, 2020:
EF-0. Economic Statistics with links to official sources
Also of interest is another one of his pages, also last edited on Sunday, February 9, 2020:
EF-5. National Debt. Deficits and Surpluses
Let's begin with a couple of questions:
[center]What Is the Bureau of Labor Statistics?
Why Does It Release All These Numbers Every Month?[/center]
The Bureau of Labor Statistics (BLS) is a unit of the United States Department of Labor. It is the principal fact-finding agency for the U.S. government in the broad field of labor economics and statistics and serves as a principal agency of the U.S. Federal Statistical System. The BLS is a governmental statistical agency that collects, processes, analyzes, and disseminates essential statistical data to the American public, the U.S. Congress, other Federal agencies, State and local governments, business, and labor representatives. The BLS also serves as a statistical resource to the Department of Labor, and conducts research into how much families need to earn to be able to enjoy a decent standard of living.
The BLS data must satisfy a number of criteria, including relevance to current social and economic issues, timeliness in reflecting today’s rapidly changing economic conditions, accuracy and consistently high statistical quality, and impartiality in both subject matter and presentation. To avoid the appearance of partiality, the dates of major data releases are scheduled more than a year in advance, in coordination with the Office of Management and Budget.
The BLS data must satisfy a number of criteria, including relevance to current social and economic issues, timeliness in reflecting today’s rapidly changing economic conditions, accuracy and consistently high statistical quality, and impartiality in both subject matter and presentation. To avoid the appearance of partiality, the dates of major data releases are scheduled more than a year in advance, in coordination with the Office of Management and Budget.
[font color="red"]New material, added August 29, 2016:[/font] Print title, Washington Post, Saturday, March 10, 2012, front page, above the fold: "Watching the clock: Monthly data release is an economic, political obsession timed to the nanosecond"
‘Jobs Day’: Monthly release of employment data an economic, political obsession
By Eli Saslow
http://twitter.com/elisaslow
March 9, 2012
The release of employment numbers by the Bureau of Labor Statistics has long been a ritual in Washington, but lately it has turned into an obsession during an election year defined by economic instability. Once each month, a nondescript government agency compiles and releases 24 tables of economic data that have come to define the 2012 election and so much else. Republican presidential candidates turn the numbers into speeches. The president’s staff monitors how they affect his approval rating. The Federal Reserve reevaluates interest rates. Investors prepare for the stock market to rise or fall, sometimes swinging in value by $150 billion in the minutes after the report is released.
....
The raw data had arrived at the Bureau of Labor Statistics (BLS), like always, on Wednesday the week before the report’s release: millions of characters representing survey information from 55,000 households; and then, a few days later, monthly payroll data from 486,000 businesses. Kosanovich’s boss posted a two-page schedule on the office wall, detailing the tasks ahead for a team of more than 20 economists. They would be required to make a series of six deadlines. Their work would undergo 15 fact checks and then 15 clearance reviews. They would sit together in a windowless conference room and read aloud from their eventual creation, a three-page news release and 24 data tables, debating commas and verbs for hours on end.
They would do it all with absolute discretion during an eight-day security lockdown, signing confidentiality agreements each morning, encrypting their computers and locking data into a safe every time they walked 10 yards away to use a bathroom. “Is your workstation secure?” asked a sign in the hallway. They all remembered the last security miscue, in November 2008 — the accidental transmission of some data to one wire service a full 25 seconds before the report’s scheduled release, an incident that had necessitated a series of internal investigations and revisions.
“We always tape paper over the windows of the conference room or draw the shades,” Kosanovich said about her typical routine during a lockdown. She made a habit of refraining from answering phone calls or e-mails from unknown numbers and never discussing data outside her office. For eight days, nobody visited her team’s floor at BLS without a security clearance. The custodial staff did not empty their trash until the report was released.
....
By Eli Saslow
http://twitter.com/elisaslow
March 9, 2012
The release of employment numbers by the Bureau of Labor Statistics has long been a ritual in Washington, but lately it has turned into an obsession during an election year defined by economic instability. Once each month, a nondescript government agency compiles and releases 24 tables of economic data that have come to define the 2012 election and so much else. Republican presidential candidates turn the numbers into speeches. The president’s staff monitors how they affect his approval rating. The Federal Reserve reevaluates interest rates. Investors prepare for the stock market to rise or fall, sometimes swinging in value by $150 billion in the minutes after the report is released.
....
The raw data had arrived at the Bureau of Labor Statistics (BLS), like always, on Wednesday the week before the report’s release: millions of characters representing survey information from 55,000 households; and then, a few days later, monthly payroll data from 486,000 businesses. Kosanovich’s boss posted a two-page schedule on the office wall, detailing the tasks ahead for a team of more than 20 economists. They would be required to make a series of six deadlines. Their work would undergo 15 fact checks and then 15 clearance reviews. They would sit together in a windowless conference room and read aloud from their eventual creation, a three-page news release and 24 data tables, debating commas and verbs for hours on end.
They would do it all with absolute discretion during an eight-day security lockdown, signing confidentiality agreements each morning, encrypting their computers and locking data into a safe every time they walked 10 yards away to use a bathroom. “Is your workstation secure?” asked a sign in the hallway. They all remembered the last security miscue, in November 2008 — the accidental transmission of some data to one wire service a full 25 seconds before the report’s scheduled release, an incident that had necessitated a series of internal investigations and revisions.
“We always tape paper over the windows of the conference room or draw the shades,” Kosanovich said about her typical routine during a lockdown. She made a habit of refraining from answering phone calls or e-mails from unknown numbers and never discussing data outside her office. For eight days, nobody visited her team’s floor at BLS without a security clearance. The custodial staff did not empty their trash until the report was released.
....
[center]Household Survey vs. Establishment Survey[/center]
From the February 10, 2011, DOL Newsletter:
Take Three
Secretary Solis answers three questions about how the Bureau of Labor Statistics calculates unemployment rates.
How does BLS determine the unemployment rate and the number of jobs that were added each month?
BLS uses two different surveys to get these numbers. The household survey, or Current Population Survey (CPS), involves asking people, from about 60,000 households, a series of questions to assess each person in the household's activities including work and searching for work. Their responses give us the unemployment rate. The establishment survey, or Current Employment Statistics (CES), surveys 140,000 employers about how many people they have on their payrolls. These results determine the number of jobs being added or lost.
Secretary Solis answers three questions about how the Bureau of Labor Statistics calculates unemployment rates.
How does BLS determine the unemployment rate and the number of jobs that were added each month?
BLS uses two different surveys to get these numbers. The household survey, or Current Population Survey (CPS), involves asking people, from about 60,000 households, a series of questions to assess each person in the household's activities including work and searching for work. Their responses give us the unemployment rate. The establishment survey, or Current Employment Statistics (CES), surveys 140,000 employers about how many people they have on their payrolls. These results determine the number of jobs being added or lost.
[font color="red"]New material, added March 9, 2018:[/font]
People often wonder how in the world the BLS comes up with all this information. This article from two months ago will help explain things:
Monthly Labor Review
JANUARY 2018
The Current Population Survey—tracking unemployment in the United States for over 75 years
For more than three-quarters of a century, the Current Population Survey has been a vital tool for providing information on U.S. unemployment and other aspects of labor market performance. This article highlights major developments in the survey’s history.
The Current Population Survey (CPS) has been conducted for more than three-quarters of a century.1 From the outset, the main purpose of the survey has been to gather information on the employment status of the U.S. population, with an emphasis on the measurement of unemployment. CPS data have been used by policymakers and others to gauge both the degree of labor market weakness during recessions and the strength of the job market in economic expansions. More than 900 monthly reports on national employment and unemployment have been issued since the survey began in March 1940.
The survey also has been used to provide a wealth of information on a wide range of other subjects—some related to the labor market and some unrelated—through supplemental questions to the basic survey instrument. Over the years, supplements to the CPS have been used to collect data on topics ranging from income and worker displacement to tobacco use and participation in the arts.
The main objective of the CPS, however, has always been to measure unemployment and other aspects of labor market performance. This article summarizes some of the major developments in achieving this goal over the past three-quarters of a century.
....
JANUARY 2018
The Current Population Survey—tracking unemployment in the United States for over 75 years
For more than three-quarters of a century, the Current Population Survey has been a vital tool for providing information on U.S. unemployment and other aspects of labor market performance. This article highlights major developments in the survey’s history.
The Current Population Survey (CPS) has been conducted for more than three-quarters of a century.1 From the outset, the main purpose of the survey has been to gather information on the employment status of the U.S. population, with an emphasis on the measurement of unemployment. CPS data have been used by policymakers and others to gauge both the degree of labor market weakness during recessions and the strength of the job market in economic expansions. More than 900 monthly reports on national employment and unemployment have been issued since the survey began in March 1940.
The survey also has been used to provide a wealth of information on a wide range of other subjects—some related to the labor market and some unrelated—through supplemental questions to the basic survey instrument. Over the years, supplements to the CPS have been used to collect data on topics ranging from income and worker displacement to tobacco use and participation in the arts.
The main objective of the CPS, however, has always been to measure unemployment and other aspects of labor market performance. This article summarizes some of the major developments in achieving this goal over the past three-quarters of a century.
....
[center]Complaint Department[/center]
I post this information on a nonpartisan basis. I am not here to make elected officials of any party or persuasion look good. I am certain that the people who compile these data are of the same outlook. They are civil servants. They do not work for a party; they work for you, the American people.
My only contribution is to cut and paste a few paragraphs from the BLS and then, in the commentary, link to some sources that I feel are trustworthy. I hope people come away with a better understanding of the data after reading this thread. Once again, I do not work for BLS, but I will nonetheless try to assist if I can.
If you feel the Bureau of Labor Statistics is handing out bunk, start here:
Point of Contact for Complaints Concerning Information Quality
Affected persons who believe that the Bureau of Labor Statistics has disseminated information that does not meet its guidelines or those of the Department of Labor or Office of Management and Budget, and who wish to file a formal complaint may send their complaint by mail, e-mail, or fax to:
Division of Management Systems
Bureau of Labor Statistics
U.S. Department of Labor
2 Massachusetts Avenue, N.E., Room 4080
Washington, D.C., 20212-0001
E-mail: dataqa@bls.gov
Fax: (202) 691-5111
Complainants should:
Identify themselves and indicate where and how they can be reached;
Identify, as specifically as possible, the information in question;
Indicate how they are affected by the information about which they are complaining;
Carefully describe the nature of the complaint, including an explanation of why they believe the information does not comply with OMB, Departmental, or agency-specific guidelines; and
Describe the change requested and the reason why the agency should make the change.
Failure to include this information may result in a complainant not receiving a response to the complaint or greatly reducing the usefulness or timeliness of any response. Complainants should be aware that they bear the burden of establishing that they are affected persons and showing the need and justification for the correction they are seeking, including why the information being complained about does not comply with applicable guidelines.
Division of Management Systems
Bureau of Labor Statistics
U.S. Department of Labor
2 Massachusetts Avenue, N.E., Room 4080
Washington, D.C., 20212-0001
E-mail: dataqa@bls.gov
Fax: (202) 691-5111
Complainants should:
Identify themselves and indicate where and how they can be reached;
Identify, as specifically as possible, the information in question;
Indicate how they are affected by the information about which they are complaining;
Carefully describe the nature of the complaint, including an explanation of why they believe the information does not comply with OMB, Departmental, or agency-specific guidelines; and
Describe the change requested and the reason why the agency should make the change.
Failure to include this information may result in a complainant not receiving a response to the complaint or greatly reducing the usefulness or timeliness of any response. Complainants should be aware that they bear the burden of establishing that they are affected persons and showing the need and justification for the correction they are seeking, including why the information being complained about does not comply with applicable guidelines.
[center]What About Employment on Farms?[/center]
[font color="red"]New material, added May 4, 2018:[/font]
Note that the BLS measures only "nonfarm payroll employment."
Nonfarm payrolls
I'm hoping the following link goes to an impartial site:
What is 'Nonfarm Payroll'
So who measures employment on farms? Hmmmmmm....
United States Department of Agriculture
Economic Research Service
Farm Labor
ERS provides information on a range of farm labor issues, including:
• Size and composition of the U.S. agricultural workforce (self-employed versus hired)
• Recent trends in the employment of hired farmworkers
• Demographic characteristics of hired farmworkers, including age, sex, and nativity
• Geographic distribution of hired farmworkers (all occupations)
• Wages of hired farmworkers
• Labor cost share of total gross revenues
• H-2A temporary agricultural visa program
• Adverse Effect Wage Rate (AEWR)
• Legal status and migration practices of hired crop farmworkers
Finally, we provide links to key data sources with summaries.
Economic Research Service
Farm Labor
ERS provides information on a range of farm labor issues, including:
• Size and composition of the U.S. agricultural workforce (self-employed versus hired)
• Recent trends in the employment of hired farmworkers
• Demographic characteristics of hired farmworkers, including age, sex, and nativity
• Geographic distribution of hired farmworkers (all occupations)
• Wages of hired farmworkers
• Labor cost share of total gross revenues
• H-2A temporary agricultural visa program
• Adverse Effect Wage Rate (AEWR)
• Legal status and migration practices of hired crop farmworkers
Finally, we provide links to key data sources with summaries.
[center]How Do You Define Unemployment?
The Large Print Giveth, and the Fine Print Taketh Away.[/center]
Long ago, a DUer pointed out that, if I'm going to post the link to the press release, I should include the link to all the tables that provide additional ways of examining the data. Specifically, I should post a link to Table A-15. Alternative measures of labor underutilization. Table A-15 includes those who are not considered unemployed, on the grounds that they have become discouraged about the prospects of finding a job and have given up looking. Here is that link:
Table A-15. Alternative measures of labor underutilization
Also, hat tip, Recursion: How the Government Measures Unemployment
[font color="red"]New material, added August 8, 2016:[/font]
This appeared at the top of page A2 in the Wednesday, July 27, 2016, print edition of The Wall Street Journal. as "Jobless Picture is Open to Interpretation."
Jobless Picture is Open to Interpretation
Gauges used to measure unemployment vary in how they define who is out of work {print: "Political campaigns clash over different ways of measuring unemployment"}
By Josh Zumbrun
josh.zumbrun@wsj.com
@JoshZumbrun
July 26, 2016 7:56 p.m. ET
Because political campaigns can rise and fall on the health of the economy, spats often flare over the gauges used to measure growth and unemployment.
The latest dust-up, raised by the campaign of Republican presidential nominee Donald Trump, focuses on the monthly employment numbers. A long streak of hiring has nudged the jobless rate down to 4.9%. ... Donald Trump Jr., the nominee’s son, recently criticized the official statistics as “artificial numbers…massaged to make the existing economy look good.”
The nominee himself has said unemployment is far higher than the Labor Department’s headline 4.9% rate would suggest, part of his message that the economy is in a dire state. After he won the New Hampshire primary in February, Mr. Trump called the official jobless figures “phony” and said the real number could be as high as 42%.
This isn’t the first time people have cast aspersions on the jobs numbers in an election year, but the Trump claim is also part of a larger discussion over how best to assess the health of the labor market.
Gauges used to measure unemployment vary in how they define who is out of work {print: "Political campaigns clash over different ways of measuring unemployment"}
By Josh Zumbrun
josh.zumbrun@wsj.com
@JoshZumbrun
July 26, 2016 7:56 p.m. ET
Because political campaigns can rise and fall on the health of the economy, spats often flare over the gauges used to measure growth and unemployment.
The latest dust-up, raised by the campaign of Republican presidential nominee Donald Trump, focuses on the monthly employment numbers. A long streak of hiring has nudged the jobless rate down to 4.9%. ... Donald Trump Jr., the nominee’s son, recently criticized the official statistics as “artificial numbers…massaged to make the existing economy look good.”
The nominee himself has said unemployment is far higher than the Labor Department’s headline 4.9% rate would suggest, part of his message that the economy is in a dire state. After he won the New Hampshire primary in February, Mr. Trump called the official jobless figures “phony” and said the real number could be as high as 42%.
This isn’t the first time people have cast aspersions on the jobs numbers in an election year, but the Trump claim is also part of a larger discussion over how best to assess the health of the labor market.
The following link to Barron's might not work for everyone. See progree's tips.[/font] From the July 20, 2015, issue of Barron's:
Refresher Course: Inside the Jobless Numbers
Are we undercounting the unemployment numbers—or overcounting? How the BLS gathers and calculates the numbers, and why it matters.
By Gene Epstein
July 18, 2015
The unemployment rate has never been the object of as much attention from the markets and the media as it is now, sparked by the keen interest taken in its monthly fluctuations by policy makers at the Federal Reserve.
Despite the heightened focus, there are a lot of misunderstandings and misconceptions about how the rate is calculated. Some people assume the Bureau of Labor Statistics compiles the rate from the unemployment-insurance rolls. On that basis, they fault the BLS for undercounting the unemployed. But that’s just one myth among many about this cornerstone measure of economic pain and labor-market slack.
To estimate the unemployment rate, the BLS actually relies on the monthly Current Population Survey conducted for it by the Census Bureau. While the data are highly imperfect in their own way, we think the Federal Reserve is right to view the official unemployment rate as the best available information, while also keeping its eye on ancillary measures of “labor underutilization.”
In fact, a close look at BLS methods suggests that, if anything, the official unemployment rate may be overcounting rather than undercounting the unemployed.
By Gene Epstein
July 18, 2015
The unemployment rate has never been the object of as much attention from the markets and the media as it is now, sparked by the keen interest taken in its monthly fluctuations by policy makers at the Federal Reserve.
Despite the heightened focus, there are a lot of misunderstandings and misconceptions about how the rate is calculated. Some people assume the Bureau of Labor Statistics compiles the rate from the unemployment-insurance rolls. On that basis, they fault the BLS for undercounting the unemployed. But that’s just one myth among many about this cornerstone measure of economic pain and labor-market slack.
To estimate the unemployment rate, the BLS actually relies on the monthly Current Population Survey conducted for it by the Census Bureau. While the data are highly imperfect in their own way, we think the Federal Reserve is right to view the official unemployment rate as the best available information, while also keeping its eye on ancillary measures of “labor underutilization.”
In fact, a close look at BLS methods suggests that, if anything, the official unemployment rate may be overcounting rather than undercounting the unemployed.
[font color="red"]New material:[/font] In August 2015, DUers whatthehey and progree got into a 1995 report from economists John E. Bregger and Steven E. Haugen. The .pdf is unfortunately an image and thus challenging as a source of quotes. Trying to find it in a format that does make for easy copying, I was led to this:
Alternative Unemployment Rates: Their Meaning and Their Measure March 12, 2014
[center]Why Won't You Talk About the Labor Force Participation Rate (LFPR)?[/center]
Every month in certain circles, someone will cite the labor force participation rate as a cause for concern. Let's look at that right now.
[font color="red"]New material, added September 30, 2016:[/font]
September 2016
Labor force participation: what has happened since the peak?
The labor force participation rate is the percentage of the civilian noninstitutional population 16 years and older that is working or actively looking for work. It is an important labor market measure because it represents the relative amount of labor resources available for the production of goods and services. After rising for more than three decades, the overall labor force participation rate peaked in early 2000 and subsequently trended down. In recent years, the movement of the baby-boom population into age groups that generally exhibit low labor force participation has contributed to the decline in the overall participation rate. From 2000 to 2015, most of the major demographic groups saw a decrease in labor force participation. Teenagers experienced the largest drop in participation, which coincided with a rise in their school enrollment rate. Young adults 20 to 24 years also showed a decline in labor force participation, but the decrease was not as steep as that for teenagers. The labor force participation rate of women 25 to 54 years also fell, with the decrease more pronounced for women who did not attend college. The labor force participation rate of men 25 to 54 years continued its long-term decline. As in the past, the decrease in participation among men with less education was greater than that of men with more education. However, labor force participation rates of men and women 55 years and older rose from 2000 to 2009 and subsequently leveled off.
Labor force participation: what has happened since the peak?
The labor force participation rate is the percentage of the civilian noninstitutional population 16 years and older that is working or actively looking for work. It is an important labor market measure because it represents the relative amount of labor resources available for the production of goods and services. After rising for more than three decades, the overall labor force participation rate peaked in early 2000 and subsequently trended down. In recent years, the movement of the baby-boom population into age groups that generally exhibit low labor force participation has contributed to the decline in the overall participation rate. From 2000 to 2015, most of the major demographic groups saw a decrease in labor force participation. Teenagers experienced the largest drop in participation, which coincided with a rise in their school enrollment rate. Young adults 20 to 24 years also showed a decline in labor force participation, but the decrease was not as steep as that for teenagers. The labor force participation rate of women 25 to 54 years also fell, with the decrease more pronounced for women who did not attend college. The labor force participation rate of men 25 to 54 years continued its long-term decline. As in the past, the decrease in participation among men with less education was greater than that of men with more education. However, labor force participation rates of men and women 55 years and older rose from 2000 to 2009 and subsequently leveled off.
[font color="red"]New material, added July 31, 2016:[/font]
Title in the print edition of the Washington Post, page A17, Wednesday, July 27, 2016: "The unemployment-rate 'conspiracy' that isn't"
A popular conspiracy theory is spreading in the Trump family. It’s totally false.
By Matt O'Brien July 26
matthew.obrien@washpost.com
@ObsoleteDogma
The unemployment rate is not a conspiracy. It is not manipulated by the Bureau of Labor Statistics. And anyone who suggests otherwise is either uninformed, or trying to misinform others.
Which is to say that you shouldn't listen to Donald Trump & Co. For a year now, the alleged billionaire has insisted that the "real" unemployment rate is something like 42 percent instead of the 4.9 percent it actually is. He hasn't said how he's gotten this — maybe it's from the same "extremely credible source" who told him President Obama's birth certificate was fake? (1) — but the simplest explanation is that he's just ballparking how many adults don't work. That's 40.4 percent right now. The problem with using that number, though, is that it counts college students and stay-at-home parents and retirees as being equally "unemployed" as people who are actively looking for work but can't find any. So it doesn't tell us too much, at least not on its own, unless you think it's a problem that we have more 70-year-olds than we used to.
(1)
Or unless conspiracy theories are one of your favorite accessories, as seems to be the case with the father, and now the son, Donald Trump Jr. On Sunday, he told CNN's Jake Tapper that the official unemployment numbers are "artificial" ones that are "massaged to make the existing economy look good" and "this administration look good."
....
Source: BLS
....
The boring truth is that the economy is in a lot better shape than it was when Obama took office, but that it could be in better shape still. The recovery, in other words, still has a ways to go. But that's a lot different from saying that we have 40 percent unemployment and that the government is trying to cover it up. That just suggests you don't understand — or don't want to accurately describe — how stats work and you don't know how to look up the ones you think the BLS is hiding. ... It's not what you'd expect from a major party presidential candidate.
By Matt O'Brien July 26
matthew.obrien@washpost.com
@ObsoleteDogma
The unemployment rate is not a conspiracy. It is not manipulated by the Bureau of Labor Statistics. And anyone who suggests otherwise is either uninformed, or trying to misinform others.
Which is to say that you shouldn't listen to Donald Trump & Co. For a year now, the alleged billionaire has insisted that the "real" unemployment rate is something like 42 percent instead of the 4.9 percent it actually is. He hasn't said how he's gotten this — maybe it's from the same "extremely credible source" who told him President Obama's birth certificate was fake? (1) — but the simplest explanation is that he's just ballparking how many adults don't work. That's 40.4 percent right now. The problem with using that number, though, is that it counts college students and stay-at-home parents and retirees as being equally "unemployed" as people who are actively looking for work but can't find any. So it doesn't tell us too much, at least not on its own, unless you think it's a problem that we have more 70-year-olds than we used to.
(1)
Link to tweet
Or unless conspiracy theories are one of your favorite accessories, as seems to be the case with the father, and now the son, Donald Trump Jr. On Sunday, he told CNN's Jake Tapper that the official unemployment numbers are "artificial" ones that are "massaged to make the existing economy look good" and "this administration look good."
....
Source: BLS
....
The boring truth is that the economy is in a lot better shape than it was when Obama took office, but that it could be in better shape still. The recovery, in other words, still has a ways to go. But that's a lot different from saying that we have 40 percent unemployment and that the government is trying to cover it up. That just suggests you don't understand — or don't want to accurately describe — how stats work and you don't know how to look up the ones you think the BLS is hiding. ... It's not what you'd expect from a major party presidential candidate.
[font color="red"]New material, added June 27, 2016:[/font]
Wonkblog
[link:https://www.washingtonpost.com/news/wonk/wp/2016/06/20/why-americas-men-arent-working/|
Why America’s men aren’t working]
By Ylan Q. Mui June 20
The national unemployment rate has fallen by more than half since the nation emerged from the worst economic crisis since the Great Depression. It peaked at 10 percent in 2010 and stood at just 4.7 percent last month.
That’s mostly good news: Private employers have added more than 14 million jobs. About 2 million people have been out of a job for six months or longer, far too many but only about a quarter of the number of long-term unemployed people seven years ago. By almost every measure, the labor market has made incredible progress.
But there’s one statistic that has been vexing economists. The size of the nation’s workforce -- known as the labor force participation rate -- continues to fall. Since the start of the downturn, the percentage of that population that has a job or is looking for one has dropped more than 3 percentage points, to 62.6 percent, a level not seen since the 1970s.
{America’s jobs market has had a great 2016. Will it last?}
The problem is particularly pronounced among men between the ages of 25 and 54, traditionally considered the prime working years. Their participation rate has been declining for decades, but the drop-off accelerated during the recession. The high mark was 98 percent in 1954, and it now stands at 88 percent. A new analysis from the White House’s Council of Economic Advisers, slated for release Monday, found that the United States now has the third-lowest participation rate for “prime-age men” among the world’s developed countries.
....
....
People in prison are not counted as part of the population for the purposes of labor market statistics. At first blush, that would actually boost the participation rate: A smaller population means the share in the workforce is larger. But in reality, there are immense and well-documented barriers to the job market for workers once they leave prison. And the gloomy prospects of the formerly incarcerated outweigh the statistical benefit of having a large prison population.
....
Ylan Q. Mui is a financial reporter at The Washington Post covering the Federal Reserve and the economy. Follow @ylanmui
[link:https://www.washingtonpost.com/news/wonk/wp/2016/06/20/why-americas-men-arent-working/|
Why America’s men aren’t working]
By Ylan Q. Mui June 20
The national unemployment rate has fallen by more than half since the nation emerged from the worst economic crisis since the Great Depression. It peaked at 10 percent in 2010 and stood at just 4.7 percent last month.
That’s mostly good news: Private employers have added more than 14 million jobs. About 2 million people have been out of a job for six months or longer, far too many but only about a quarter of the number of long-term unemployed people seven years ago. By almost every measure, the labor market has made incredible progress.
But there’s one statistic that has been vexing economists. The size of the nation’s workforce -- known as the labor force participation rate -- continues to fall. Since the start of the downturn, the percentage of that population that has a job or is looking for one has dropped more than 3 percentage points, to 62.6 percent, a level not seen since the 1970s.
{America’s jobs market has had a great 2016. Will it last?}
The problem is particularly pronounced among men between the ages of 25 and 54, traditionally considered the prime working years. Their participation rate has been declining for decades, but the drop-off accelerated during the recession. The high mark was 98 percent in 1954, and it now stands at 88 percent. A new analysis from the White House’s Council of Economic Advisers, slated for release Monday, found that the United States now has the third-lowest participation rate for “prime-age men” among the world’s developed countries.
....
....
People in prison are not counted as part of the population for the purposes of labor market statistics. At first blush, that would actually boost the participation rate: A smaller population means the share in the workforce is larger. But in reality, there are immense and well-documented barriers to the job market for workers once they leave prison. And the gloomy prospects of the formerly incarcerated outweigh the statistical benefit of having a large prison population.
....
Ylan Q. Mui is a financial reporter at The Washington Post covering the Federal Reserve and the economy. Follow @ylanmui
[font color="red"]New material, added January 2016:[/font] People who are not in the labor force: why aren't they working?
Beyond the Numbers
December 2015 | Vol. 4 / No. 15
EMPLOYMENT & UNEMPLOYMENT
People who are not in the labor force: why aren't they working?
By Steven F. Hipple
People who are neither working nor looking for work are counted as “not in the labor force,” according to the U.S. Bureau of Labor Statistics. Since 2000, the percentage of people in this group has increased. Data from the Current Population Survey (CPS) and its Annual Social and Economic Supplement (ASEC) provide some insight into why people are not in the labor force. The ASEC is conducted in the months of February through April and includes questions about work and other activities in the previous calendar year. For example, data collected in 2015 are for the 2014 calendar year, and data collected in 2005 are for the 2004 calendar year.1 In the ASEC, people who did not work at all in the previous year are asked to give the main reason they did not work. Interviewers categorize survey participants’ verbatim responses into the following categories: ill health or disabled; retired;2 home responsibilities; going to school; could not find work;3 and other reasons.
This Beyond the Numbers article examines data on those who were not in the labor force during 2004 and 2014 and the reasons they gave for not working. The data are limited to people who neither worked nor looked for work during the previous year.
December 2015 | Vol. 4 / No. 15
EMPLOYMENT & UNEMPLOYMENT
People who are not in the labor force: why aren't they working?
By Steven F. Hipple
People who are neither working nor looking for work are counted as “not in the labor force,” according to the U.S. Bureau of Labor Statistics. Since 2000, the percentage of people in this group has increased. Data from the Current Population Survey (CPS) and its Annual Social and Economic Supplement (ASEC) provide some insight into why people are not in the labor force. The ASEC is conducted in the months of February through April and includes questions about work and other activities in the previous calendar year. For example, data collected in 2015 are for the 2014 calendar year, and data collected in 2005 are for the 2004 calendar year.1 In the ASEC, people who did not work at all in the previous year are asked to give the main reason they did not work. Interviewers categorize survey participants’ verbatim responses into the following categories: ill health or disabled; retired;2 home responsibilities; going to school; could not find work;3 and other reasons.
This Beyond the Numbers article examines data on those who were not in the labor force during 2004 and 2014 and the reasons they gave for not working. The data are limited to people who neither worked nor looked for work during the previous year.
This July 2014 report from the Council of Economic Advisers addresses the LFPR:
THE LABOR FORCE PARTICIPATION RATE SINCE 2007: CAUSES AND POLICY IMPLICATIONS
(Hat tip, Adrahil: Look deeper.)
[font color="red"]New material:[/font] Here's a Power Point (or equivalent) presentation given by Jason Furman, Chairman of the Council of Economic Advisers, before the National Press Club on August 6, 2015. If you go to the next-to-the-last slide, you'll see that the long-term projected trend is down:
"Trends in Labor Force Participation", 8/6/15
(Hat tip, progree: Over the past month, over the past year, and since February 2010)
[font color="red"]New material:[/font] Paul Vigna had a comment about the LFPR in the December 4, 2015, MoneyBeat column about the November figures:
8:55 am
Breaking down the participation rate
by Paul Vigna
Here’s what we mean when we talk about the participation rate and employment-population ratio.
There are 251.7 million people in the “civilian noninstitutional population,” according to the BLS (this is all contained in this chart). This is the number of people over age 16 who are not in jail or health-care facilities or the military.
Of that group, 157.3 million comprise the civilian labor force. The ratio of the second group to the first is 62.5%. This is the labor force participation rate, the number of people who could be in the labor force – either working or looking for a job – who are in the labor force.
There are 149.3 million people working. The ratio of that group to the overall civilian population is 59.3%. This the employment-population ratio, the number of people who could be working who actually are working.
Why do these number matter? Well, if you just looked at the raw data, you’d see the numbers rising, more or less, month after month. That’s not because the economy’s so rip-roaring, but because the number of people in the nation keeps rising. So you need the ratios to get a sense of how strong the labor force really is.
The labor-force participation rate remains near multi-decade lows, and whether that’s due to demographics, as in people retiring, or weak job opportunities, or whatever, it points to one sort of unavoidable problem: the economy cannot grow at its full potential if you simply don’t have enough people contributing.
Oh, and for the record, there are 94.4 million people not in the labor force.
Breaking down the participation rate
by Paul Vigna
Here’s what we mean when we talk about the participation rate and employment-population ratio.
There are 251.7 million people in the “civilian noninstitutional population,” according to the BLS (this is all contained in this chart). This is the number of people over age 16 who are not in jail or health-care facilities or the military.
Of that group, 157.3 million comprise the civilian labor force. The ratio of the second group to the first is 62.5%. This is the labor force participation rate, the number of people who could be in the labor force – either working or looking for a job – who are in the labor force.
There are 149.3 million people working. The ratio of that group to the overall civilian population is 59.3%. This the employment-population ratio, the number of people who could be working who actually are working.
Why do these number matter? Well, if you just looked at the raw data, you’d see the numbers rising, more or less, month after month. That’s not because the economy’s so rip-roaring, but because the number of people in the nation keeps rising. So you need the ratios to get a sense of how strong the labor force really is.
The labor-force participation rate remains near multi-decade lows, and whether that’s due to demographics, as in people retiring, or weak job opportunities, or whatever, it points to one sort of unavoidable problem: the economy cannot grow at its full potential if you simply don’t have enough people contributing.
Oh, and for the record, there are 94.4 million people not in the labor force.
[font color="red"]New material, added December 2015:[/font]
3:12 pm ET
Dec 8, 2015
economics
As America’s Workforce Ages, Here’s Where the Jobs Will Be
By Jeffrey Sparshott
Jeffrey.Sparshott@wsj.com
@jeffsparshott
The U.S. labor force is expected to expand only slowly over the coming decade as the country ages and more Americans give up on holding a job, a potential drag on broader economic growth.
The economy is expected to generate 9.8 million new jobs, a 6.5% increase, from 2014 to 2024, the Labor Department said in new projections released Tuesday. While steady, that is a historically slow pace. By comparison, 10-year job creation averaged almost 14% during the 2001-07 expansion and close to 17% during the 1990s.
The slowdown highlights declining participation as baby boomers retire and younger Americans opt out of the workforce. Those two trends are expected to continue to push the labor-force participation rate lower, to 60.9% in 2024 from 62.9% in 2014, Labor estimates. If realized, that would be the lowest level since 1973, when Richard Nixon was president.
Federal Reserve Chairwoman Janet Yellen at a congressional hearing last week held out hope the participation rate would hold near current levels as people came off the sidelines and into jobs.
Dec 8, 2015
economics
As America’s Workforce Ages, Here’s Where the Jobs Will Be
By Jeffrey Sparshott
Jeffrey.Sparshott@wsj.com
@jeffsparshott
The U.S. labor force is expected to expand only slowly over the coming decade as the country ages and more Americans give up on holding a job, a potential drag on broader economic growth.
The economy is expected to generate 9.8 million new jobs, a 6.5% increase, from 2014 to 2024, the Labor Department said in new projections released Tuesday. While steady, that is a historically slow pace. By comparison, 10-year job creation averaged almost 14% during the 2001-07 expansion and close to 17% during the 1990s.
The slowdown highlights declining participation as baby boomers retire and younger Americans opt out of the workforce. Those two trends are expected to continue to push the labor-force participation rate lower, to 60.9% in 2024 from 62.9% in 2014, Labor estimates. If realized, that would be the lowest level since 1973, when Richard Nixon was president.
Federal Reserve Chairwoman Janet Yellen at a congressional hearing last week held out hope the participation rate would hold near current levels as people came off the sidelines and into jobs.
[center]Nattering Nabobs of Negativism[/center]
[font color="red"]New material, added February 26, 2016:[/font] More High-Wage Employment Doesn't Mean the Job Market's Out of the Woods
That's the print edition title.
Wonkblog
The recovery is generating more high-wage jobs — but does that matter?
The U.S. is still digging out of a big hole, and isn't creating new opportunities for those whose jobs disappeared.
By Lydia DePillis February 24
@lydiadepillis
A couple of weeks ago, some economists from Goldman Sachs came out with a rosy pronouncement: "Millions of new jobs and plenty of good ones," read the headline on a note to investors. High-wage employment appeared to pick up from 2013 to the present, a change from the early years of the economic recovery, which generated a disproportionate number of low-wage jobs.
And you don’t have to just take it from an investment bank. The Department of Labor has run its own numbers, and saw similar growth back in October, rendered in absolute numbers rather than growth rates (which Labor’s Chief Economist Heidi Shierholz says held through the end of 2015 in an analysis the department completed last week).
The green bars in the graph below show changes in actual employment, and the orange line shows what it would have been if the growth had been evenly distributed. Shierholz says the loss of low-wage jobs is likely a result of workers in those categories having their wages bumped up above $10 an hour, as the huge growth in low-wage sectors from 2009-2013 led to competition for people in restaurants and retail, or finding better jobs.
That renewed growth in high-wage jobs, which started to show up in 2014, is typical of recoveries from recessions: Low-wage retail and restaurant jobs come back first, as consumers start to buy small-ticket items and go out to eat again. Later on, the profitability trickles up, leading firms to make more expensive hires. Overall, the trend could be responsible for the small uptick in wages that's become evident in recent months, as well.
The recovery is generating more high-wage jobs — but does that matter?
The U.S. is still digging out of a big hole, and isn't creating new opportunities for those whose jobs disappeared.
By Lydia DePillis February 24
@lydiadepillis
A couple of weeks ago, some economists from Goldman Sachs came out with a rosy pronouncement: "Millions of new jobs and plenty of good ones," read the headline on a note to investors. High-wage employment appeared to pick up from 2013 to the present, a change from the early years of the economic recovery, which generated a disproportionate number of low-wage jobs.
And you don’t have to just take it from an investment bank. The Department of Labor has run its own numbers, and saw similar growth back in October, rendered in absolute numbers rather than growth rates (which Labor’s Chief Economist Heidi Shierholz says held through the end of 2015 in an analysis the department completed last week).
The green bars in the graph below show changes in actual employment, and the orange line shows what it would have been if the growth had been evenly distributed. Shierholz says the loss of low-wage jobs is likely a result of workers in those categories having their wages bumped up above $10 an hour, as the huge growth in low-wage sectors from 2009-2013 led to competition for people in restaurants and retail, or finding better jobs.
That renewed growth in high-wage jobs, which started to show up in 2014, is typical of recoveries from recessions: Low-wage retail and restaurant jobs come back first, as consumers start to buy small-ticket items and go out to eat again. Later on, the profitability trickles up, leading firms to make more expensive hires. Overall, the trend could be responsible for the small uptick in wages that's become evident in recent months, as well.
[font color="red"]Revised material:[/font] Here’s a grim thought:
Fed economists: America’s missing workers are not coming back
Wonkblog
By Max Ehrenfreund September 12 {2014}
A paper by Federal Reserve staff that will be discussed at the Brookings Institution on Friday {September 12, 2014} possibly hints at the central bank's thinking on interest rates and employment in advance of a consequential Fed meeting next week. The findings support [links:http://online.wsj.com/articles/fed-minutes-rate-hike-debate-heating-up-1408557628|hawks] on the Federal Open Market Committee, who feel that the Fed needs to prepare to raise rates sooner than expected, although the results are still being debated and might not persuade the committee's more dovish members.
The paper discusses the number of people who consider themselves part of the workforce -- including both people who have a job and those who are looking for work. It is a measure of the total manpower available in the U.S. economy. This number, the labor force participation rate, has been decreasing steadily since 2000. Americans who can't find work have been leaving the workforce, as have more and more retirees as the population ages.
By Max Ehrenfreund September 12 {2014}
A paper by Federal Reserve staff that will be discussed at the Brookings Institution on Friday {September 12, 2014} possibly hints at the central bank's thinking on interest rates and employment in advance of a consequential Fed meeting next week. The findings support [links:http://online.wsj.com/articles/fed-minutes-rate-hike-debate-heating-up-1408557628|hawks] on the Federal Open Market Committee, who feel that the Fed needs to prepare to raise rates sooner than expected, although the results are still being debated and might not persuade the committee's more dovish members.
The paper discusses the number of people who consider themselves part of the workforce -- including both people who have a job and those who are looking for work. It is a measure of the total manpower available in the U.S. economy. This number, the labor force participation rate, has been decreasing steadily since 2000. Americans who can't find work have been leaving the workforce, as have more and more retirees as the population ages.
Let’s follow that with another grim thought:
Why wage growth disparity tells the story of America's half-formed economic recovery
By Chico Harlan November 21, 2014
chico.harlan@washpost.com
@chicoharlan
....
With unemployment down to 5.8 percent, the country’s half-formed recovery is often described with a convenient shorthand: We have jobs but little wage growth. But stagnancy is just an average, and for many Americans, the years since the financial crisis have pushed them farther from the line, according to a detailed analysis of government labor statistics by The Washington Post.
....
Among the winners in this climate: Older workers, women and those with finance and technology jobs. ... Among the losers: Part-timers, the young, men, and those in the health, retail and food industries.
....
Chico Harlan covers personal economics as part of The Post's financial team.
chico.harlan@washpost.com
@chicoharlan
....
With unemployment down to 5.8 percent, the country’s half-formed recovery is often described with a convenient shorthand: We have jobs but little wage growth. But stagnancy is just an average, and for many Americans, the years since the financial crisis have pushed them farther from the line, according to a detailed analysis of government labor statistics by The Washington Post.
....
Among the winners in this climate: Older workers, women and those with finance and technology jobs. ... Among the losers: Part-timers, the young, men, and those in the health, retail and food industries.
....
Chico Harlan covers personal economics as part of The Post's financial team.
Dissenters, take note:
A New Reason to Question the Official Unemployment Rate
David Leonhardt
AUG. 26, 2014
The Labor Department’s monthly jobs report has been the subject of some wacky conspiracy theories. None was wackier than the suggestion from Jack Welch, the former General Electric chief executive, that government statisticians were exaggerating job growth during President Obama’s 2012 re-election campaign. Both Republican and Democratic economists dismissed those charges as silly.
But to call the people who compile the jobs report honest, nonpartisan civil servants is not to say that the jobs report is perfect. The report tries to estimate employment in a big country – and to do so quickly, to give policy makers, business executives and everyone else a sense of how the economy is performing. It’s a tough task.
And it has become tougher, because Americans are less willing to respond to surveys than they used to be.
A new academic paper suggests that the unemployment rate appears to have become less accurate over the last two decades, in part because of this rise in nonresponse. In particular, there seems to have been an increase in the number of people who once would have qualified as officially unemployed and today are considered out of the labor force, neither working nor looking for work.
AUG. 26, 2014
The Labor Department’s monthly jobs report has been the subject of some wacky conspiracy theories. None was wackier than the suggestion from Jack Welch, the former General Electric chief executive, that government statisticians were exaggerating job growth during President Obama’s 2012 re-election campaign. Both Republican and Democratic economists dismissed those charges as silly.
But to call the people who compile the jobs report honest, nonpartisan civil servants is not to say that the jobs report is perfect. The report tries to estimate employment in a big country – and to do so quickly, to give policy makers, business executives and everyone else a sense of how the economy is performing. It’s a tough task.
And it has become tougher, because Americans are less willing to respond to surveys than they used to be.
A new academic paper suggests that the unemployment rate appears to have become less accurate over the last two decades, in part because of this rise in nonresponse. In particular, there seems to have been an increase in the number of people who once would have qualified as officially unemployed and today are considered out of the labor force, neither working nor looking for work.
[font color="red"]New material, added January 2016:[/font] From July 2013:
Mort Zuckerman: A Jobless Recovery Is a Phony Recovery
Commentary
Mort Zuckerman: A Jobless Recovery Is a Phony Recovery
More people have left the workforce than got a new job during the recovery—by a factor of nearly three.
By Mortimer Zuckerman
July 15, 2013 7:09 p.m. ET
In recent months, Americans have heard reports out of Washington and in the media that the economy is looking up—that recovery from the Great Recession is gathering steam. If only it were true. The longest and worst recession since the end of World War II has been marked by the weakest recovery from any U.S. recession in that same period.
The jobless nature of the recovery is particularly unsettling. In June, the government's Household Survey reported that since the start of the year, the number of people with jobs increased by 753,000—but there are jobs and then there are "jobs." No fewer than 557,000 of these positions were only part-time. The survey also reported that in June full-time jobs declined by 240,000, while part-time jobs soared by 360,000 and have now reached an all-time high of 28,059,000—three million more part-time positions than when the recession began at the end of 2007.
That's just for starters. The survey includes part-time workers who want full-time work but can't get it, as well as those who want to work but have stopped looking. That puts the real unemployment rate for June at 14.3%, up from 13.8% in May.
The 7.6% unemployment figure so common in headlines these days is utterly misleading. An estimated 22 million Americans are unemployed or underemployed; they are virtually invisible and mostly excluded from unemployment calculations that garner headlines.
....
Mr. Zuckerman is chairman and editor in chief of U.S. News & World Report.
Mort Zuckerman: A Jobless Recovery Is a Phony Recovery
More people have left the workforce than got a new job during the recovery—by a factor of nearly three.
By Mortimer Zuckerman
July 15, 2013 7:09 p.m. ET
In recent months, Americans have heard reports out of Washington and in the media that the economy is looking up—that recovery from the Great Recession is gathering steam. If only it were true. The longest and worst recession since the end of World War II has been marked by the weakest recovery from any U.S. recession in that same period.
The jobless nature of the recovery is particularly unsettling. In June, the government's Household Survey reported that since the start of the year, the number of people with jobs increased by 753,000—but there are jobs and then there are "jobs." No fewer than 557,000 of these positions were only part-time. The survey also reported that in June full-time jobs declined by 240,000, while part-time jobs soared by 360,000 and have now reached an all-time high of 28,059,000—three million more part-time positions than when the recession began at the end of 2007.
That's just for starters. The survey includes part-time workers who want full-time work but can't get it, as well as those who want to work but have stopped looking. That puts the real unemployment rate for June at 14.3%, up from 13.8% in May.
The 7.6% unemployment figure so common in headlines these days is utterly misleading. An estimated 22 million Americans are unemployed or underemployed; they are virtually invisible and mostly excluded from unemployment calculations that garner headlines.
....
Mr. Zuckerman is chairman and editor in chief of U.S. News & World Report.
[center]On the Road Again[/center]
The DOL Newsletter - October 6, 2011
DOL Data: There's an App for That
Have an iPhone, iPod Touch or Android phone? Now you can access the latest labor data and news from the department's Bureau of Labor Statistics and Employment and Training Administration in the palm of your hand. The latest free mobile app displays real-time updates to the unemployment rate, Unemployment Insurance initial claims, the Consumer Price Index, payroll employment, average hourly earnings, the Producer Price Index, the Employment Cost Index, productivity, the U.S. Import Price Index and the U.S. Export Price Index in real time, as they are published each week, month or quarter. News releases providing context for the data can also be accessed through the app and viewed within a mobile browser or as PDF documents.
Have an iPhone, iPod Touch or Android phone? Now you can access the latest labor data and news from the department's Bureau of Labor Statistics and Employment and Training Administration in the palm of your hand. The latest free mobile app displays real-time updates to the unemployment rate, Unemployment Insurance initial claims, the Consumer Price Index, payroll employment, average hourly earnings, the Producer Price Index, the Employment Cost Index, productivity, the U.S. Import Price Index and the U.S. Export Price Index in real time, as they are published each week, month or quarter. News releases providing context for the data can also be accessed through the app and viewed within a mobile browser or as PDF documents.
US Labor Department launches economic and employment statistics app
Smartphone users gain mobile access to latest labor data and news
WASHINGTON — The most up-to-date employment data and economic news releases from the U.S. Department of Labor's Bureau of Labor Statistics and its Employment and Training Administration now can be viewed using a new mobile application.
....
The new app is currently available for the iPhone and iPod Touch as well as Android phones. The Labor Department is working to develop versions for BlackBerry and iPad devices. Visit https://m.dol.gov/apps/ to download this and other mobile apps.
WASHINGTON — The most up-to-date employment data and economic news releases from the U.S. Department of Labor's Bureau of Labor Statistics and its Employment and Training Administration now can be viewed using a new mobile application.
....
The new app is currently available for the iPhone and iPod Touch as well as Android phones. The Labor Department is working to develop versions for BlackBerry and iPad devices. Visit https://m.dol.gov/apps/ to download this and other mobile apps.
Download the Data, Other Mobile Apps
[center]A Few More Things[/center]
[font color="red"]New material, added July 8, 2017:[/font]
The power of the president over the economy is limited
By Ezra Klein January 13, 2012
....
But it would be even better if voters had a consistent benchmark for judging a president’s performance. The question — and it’s a tough one — is how to separate the very real influence the president has on the economy from the myriad other factors that weigh on whether consumers spend and businesses hire. So I put the issue to an exclusive club of economists who have an unusually fine-grained understanding of what the president can and can’t do: the former chairs of the president’s Council of Economic Advisers. And I asked each the same question: How much of national job creation during a presidency can we properly attribute to the president?
“Very little,” wrote Harvard’s Martin Feldstein in an e-mail. Feldstein led the CEA under Reagan, and he didn’t see much role for the president in normal economic times. “The key is growth of population and labor force participation. Policy — primarily monetary policy — affects cyclical conditions and therefore the unemployment rate. Fiscal policy is usually irrelevant but with interest rates at the current level there has been a role for fiscal policy.”
Laura D’Andrea Tyson, a Berkeley economist who served under President Clinton, emphasized the need to consider timing in our evaluations. “There are significant lags between the time a President proposes a policy, the time it is enacted by Congress and the time necessary for it to take effect,” she wrote to me. “These lags should be taken into account in measuring the economy’s job performance under a President. The first year probably should not count at all in terms of assessing the effects of a new Administration’s policies.”
Greg Mankiw, a Harvard economist who served as CEA chair under George W. Bush, directed me to a blog post he had written on the subject. “Randomness is a fact of economic life,” Mankiw wrote, “and it would be a mistake to judge a president by the economic outcome during his administration. It is better to look at the decisions the president made, and to acknowledge that the outcome is a function of those decisions and many other factors not under his control. As an economist, I have views about what best practices are for economic policy, and I judge presidents by how closely they adhere to those principles.” ... “Unfortunately,” he concluded, “that evaluation process is not quite as simple and objective as the reader might have hoped for. But I don’t think there is a better alternative.”
....
kleine@washpost.com
https://twitter.com/ezraklein
By Ezra Klein January 13, 2012
....
But it would be even better if voters had a consistent benchmark for judging a president’s performance. The question — and it’s a tough one — is how to separate the very real influence the president has on the economy from the myriad other factors that weigh on whether consumers spend and businesses hire. So I put the issue to an exclusive club of economists who have an unusually fine-grained understanding of what the president can and can’t do: the former chairs of the president’s Council of Economic Advisers. And I asked each the same question: How much of national job creation during a presidency can we properly attribute to the president?
“Very little,” wrote Harvard’s Martin Feldstein in an e-mail. Feldstein led the CEA under Reagan, and he didn’t see much role for the president in normal economic times. “The key is growth of population and labor force participation. Policy — primarily monetary policy — affects cyclical conditions and therefore the unemployment rate. Fiscal policy is usually irrelevant but with interest rates at the current level there has been a role for fiscal policy.”
Laura D’Andrea Tyson, a Berkeley economist who served under President Clinton, emphasized the need to consider timing in our evaluations. “There are significant lags between the time a President proposes a policy, the time it is enacted by Congress and the time necessary for it to take effect,” she wrote to me. “These lags should be taken into account in measuring the economy’s job performance under a President. The first year probably should not count at all in terms of assessing the effects of a new Administration’s policies.”
Greg Mankiw, a Harvard economist who served as CEA chair under George W. Bush, directed me to a blog post he had written on the subject. “Randomness is a fact of economic life,” Mankiw wrote, “and it would be a mistake to judge a president by the economic outcome during his administration. It is better to look at the decisions the president made, and to acknowledge that the outcome is a function of those decisions and many other factors not under his control. As an economist, I have views about what best practices are for economic policy, and I judge presidents by how closely they adhere to those principles.” ... “Unfortunately,” he concluded, “that evaluation process is not quite as simple and objective as the reader might have hoped for. But I don’t think there is a better alternative.”
....
kleine@washpost.com
https://twitter.com/ezraklein
[font color="red"]New material, added February 4, 2016:[/font] This article appeared as "Stocks vs. the Economy: Which Ruins Which?"on page C2 of the print edition of The Wall Street Journal. on Tuesday, February 2, 2016.
Does the Economy Ruin the Stock Market or Does the Stock Market Ruin the Economy?
2:49 pm ET
Feb 1, 2016
Markets
By John Carney
Don’t confuse the market for the economy. Markets have overshot fundamentals. There are no signs of contagion into the real economy. ... Anyone paying attention has heard some version of these sentiments lately. Paul Samuelson’s famous quip that the market has predicted nine of the past five recessions is once again on the lips of the wise men and women of Wall Street.
But what if the stock market is more than just an indicator? What if a stock selloff can actually cause unemployment and recessions? ... That’s exactly what historical data on the stock market and the unemployment rate running back to 1929 seem to suggest. A persistent 10% decline in the stock market pushes unemployment up three percentage points.
That, at least, is the finding of University of California Los Angeles economist Roger Farmer. Currently a Distinguished Professor of Economics at UCLA and a Visiting Scholar at the Federal Reserve Bank of San Francisco, Mr. Farmer has been a fellow at the Bank of England and has won awards for his work on inefficiency in financial markets and self-fullfilling prophecies.
In a pair of academic papers written in the wake of the financial crisis, the first published in 2012 and the second published this year, Mr. Farmer has argued that changes in the value of the stock market cause changes in the unemployment rate. The idea will be expanded upon in Mr. Farmer’s forthcoming book, Prosperity for All.
2:49 pm ET
Feb 1, 2016
Markets
By John Carney
Don’t confuse the market for the economy. Markets have overshot fundamentals. There are no signs of contagion into the real economy. ... Anyone paying attention has heard some version of these sentiments lately. Paul Samuelson’s famous quip that the market has predicted nine of the past five recessions is once again on the lips of the wise men and women of Wall Street.
But what if the stock market is more than just an indicator? What if a stock selloff can actually cause unemployment and recessions? ... That’s exactly what historical data on the stock market and the unemployment rate running back to 1929 seem to suggest. A persistent 10% decline in the stock market pushes unemployment up three percentage points.
That, at least, is the finding of University of California Los Angeles economist Roger Farmer. Currently a Distinguished Professor of Economics at UCLA and a Visiting Scholar at the Federal Reserve Bank of San Francisco, Mr. Farmer has been a fellow at the Bank of England and has won awards for his work on inefficiency in financial markets and self-fullfilling prophecies.
In a pair of academic papers written in the wake of the financial crisis, the first published in 2012 and the second published this year, Mr. Farmer has argued that changes in the value of the stock market cause changes in the unemployment rate. The idea will be expanded upon in Mr. Farmer’s forthcoming book, Prosperity for All.
[font color="red"]Moved here, February 6, 2016:[/font] The Federal Reserve looks at, among many other things, the BLS employment reports when it decides what to do with "the interest rate." The interest rate in question is the federal funds target rate. Here is some information about that:
Federal funds rate
The federal funds target rate is determined by a meeting of the members of the Federal Open Market Committee which normally occurs eight times a year about seven weeks apart. The committee may also hold additional meetings and implement target rate changes outside of its normal schedule.
Meet FRED, every wonk’s secret weapon
Storyline ? Meet the wonks
By Todd C. Frankel August 1, 2014
FRED stands for Federal Reserve Economic Data. It serves as an online clearinghouse for a wealth of numbers: unemployment rates, prices of goods, GDP and CPI, things common and obscure. Today, FRED is more than a little bit famous, thanks to the public’s fascination with economic data.
By Todd C. Frankel August 1, 2014
FRED stands for Federal Reserve Economic Data. It serves as an online clearinghouse for a wealth of numbers: unemployment rates, prices of goods, GDP and CPI, things common and obscure. Today, FRED is more than a little bit famous, thanks to the public’s fascination with economic data.
Federal Reserve Economic Data
So how many jobs must be created every month to have an effect on the unemployment rate? There's an app for that:
Federal Reserve Bank of Atlanta Jobs Calculator™
(Note new link for Jobs Calculator™. Hat tip, progree.)
Monthly Employment Reports from BLS
The U.S. Department of Commerce releases economic data too. Some of its releases come from the U.S. Census Bureau:
U.S. Census Bureau Latest News
U.S. Census Bureau Economic Indicators
Other Department of Commerce releases come from the Bureau of Economic Analysis:
Bureau of Economic Analysis
For people who need a daily fix:
BLS-Labor Statistics Twitter feed
Read tomorrow's news before it happens. Here's the schedule for all economic reports:
MarketWatch Economic Calendar
and for BLS reports only:
Bureau of Labor Statistics Release Calendar
Response to BumRushDaShow (Original post)
