Obama’s October Surprise — September jobs report? No Really?

Russ Steele

We all knew it was going to happen, the numbers would be rigged to get the unemployment number down.  You can change that number  by juggling the numbers, but you canot change reality. James Pethokoukis at the American Enterprise Institute has an article titled The sickly, stagnant September jobs report, that is worth your time to read.

Bottom line: The U.S. labor market remains in a deep depression with virtually no recovery since the official end of the Great Recession. But the Long Recession continues unabated.

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About Russ Steele
Freelance writer and climate change blogger. Russ spent twenty years in the Air Force as a navigator specializing in electronics warfare and digital systems. After his service he was employed for sixteen years as concept developer for TRW, an aerospace and automotive company, and then was CEO of a non-profit Internet provider for 18 months. Russ's articles have appeared in Comstock's Business, Capitol Journal, Trailer Life, Monitoring Times, and Idaho Magazine.

One Response to Obama’s October Surprise — September jobs report? No Really?

  1. More from James Pethokoukis, eye-opening note from economists John Ryding and Conrad DeQuadros of RDQ Economics:

    This report is a tale of two labor markets.  The establishment survey (payrolls) painted a picture of moderately growing employment over the last three months but at a marginally slower pace than over the last year.  At this pace of job creation, the unemployment rate should be barely drifting lower given underlying demographic trends.  In contrast, the household survey painted a picture of a sharply falling unemployment rate—down 1.2% points over the last 12 months.  Such a rapid decline in the unemployment rate would be consistent with 4%–5% real economic growth historically but much of the decline is accounted for by people dropping out of the labor force (over the last year the employment-population ratio has risen to only 58.7% from 58.4%).  We believe part of the drop in the unemployment rate over the last two months is a statistical quirk (the household data show an increase in employment of 873,000 in September, which is completely implausible and likely a result of sampling volatility).  Moreover, declining labor force participation over the last year (resulting in 1.1 million people disappearing from the labor force) accounts for much of the rest of the decline.  With this report, the ISMs, and vehicle sales, the September economy is off to a better-than-expected start but nowhere near as good as suggested by the decline in the unemployment rate.

    Of course, the economy is not growing 4-5%, not even half that. This a jobs recovery built on part-time jobs, falling wages, and disappeared discouraged workers. As JPMorgan’s econ team noted: “The one asterisk to the good news from the household survey was the apparent low-quality composition of the jobs created, as there was a surge in people working part-time for economic reasons, a development which left the widely-followed U-6 broad measure of underemployment unchanged at 14.7%.”

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