Elizabeth: The Unemployment Numbers Game
I told my husband less than two weeks ago – mark my words by the time November 6th rolls around – President Obama will have figured out a way to get the unemployment rate below 8%! Well, my words have proven true! According to the latest unemployment numbers, somehow, magically, the unemployment rate has dropped to 7.8%. The reason I say “magically” is because the economy only added 114,000 jobs.
Now before I get into the meat of the unemployment numbers for September – let me give you a short lesson on the economy and the unemployment numbers put out by the Bureau of Labor Statistics:
- According to economists - in order for the economy to keep up with population growth – the economy must create 125,000 NEW jobs EVERY month.
- The labor department considers someone as unemployed if they are unemployed and have looked for work in the past 4 weeks. So every person who gives up looking for work because they are discouraged, sick and unable to look for work, or decide to take an early retirement are not counted as part of unemployment numbers.
- The unemployment numbers that come out each month consist of two parts – the numbers provided by businesses telling the government how many jobs they created in the past month and a phone poll done by the government asking each household, usually about 60,000, whether they were employed in the last 4 weeks.
Now if the economy has to add 125,000 jobs each month just to keep up with population growth, how is it that the unemployment rate keeps dropping?
According to the unemployment numbers put out last month by the Bureau of Labor Statistics, the unemployment rate in August dropped from 8.3% to 8.1% – even though the economy only added 110,000 jobs. The reason: almost 400,000 people dropped out of the workforce.
This month, according to labor statistics, the unemployment rate for September dropped 0.3% to 7.8% and the number of unemployed individuals dropped 456,000 to 12.1 million people.
This even though the economy only added 114,000 jobs AND, according to the mainstream media, more people looked for work this month. If the economy only added 114,000 jobs and 456,000 less people are considered unemployed – wouldn’t that mean that another 342,000 people would have had to drop out of the work-force – not rejoined the work force? You’d think right.
What is the most interesting thing about the new unemployment numbers is that according to the “Household Survey” (the individual phone poll), 873,000 more people were employed in September than in August – the biggest one month jump since 1983. Hmmmm, once again something isn’t adding up.
How can the economy add 114,000 jobs but the number of employed households jumps 873,000? The 114,000 jobs added to the economy were jobs that businesses reported hiring. The 873,000 number, the number that shrank the unemployment numbers substantially, were the numbers concocted by individual phone polls. Now even though it would be pretty hard to finagle the business numbers that come in, it would be a whole lot easier to sway individual phone poll numbers in President Obama’s favor.
Another interesting thing about the Household Survey, was that most of the so called jobs that were created were part-time jobs. So all the Obama administration had to do was to get people to say was that they had worked a couple of hours in the past month and voila 873,000 more people with jobs!
The “real” unemployment rate – the rate that includes discouraged workers and underemployed workers stayed steady at 14.7% – so it isn’t hard to see that these “new” unemployment numbers are a pure fabrication by the Obama administration to sway the election in Obama’s favor. However, the mainstream media is already lapping it up. A headline at USA Today read “Political Analysis: Jobs report boosts Obama“ and unfortunately for us and Mitt Romney – many undecided voters WILL be swayed by these numbers. These voters will think – President Obama is doing a pretty good job because the unemployment rate is dropping and people are getting jobs….I think I will vote for Obama!
However, as we all know, President Obama will do anything, including cook unemployment numbers, to get elected. Jack Welch described it best on his Twitter account this week when he said “Unbelievable jobs numbers…these Chicago guys will do anything…can’t debate so change numbers“. Well said, Jack, well said.