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September Shocker

Jobs: A September Shocker

Recall that the decline of 4,000 jobs originally reported for August was seen as the catalyst for the central bank’s big rate cut. Well, that figure was revised by the Bureau of Labor Statistics (BLS) to a gain of 89,000 in the September report.

I know, I know, it seems almost too good to be true. Well it is.

Economic Populist: The working age population was 232,461,000 in September 2007. The employment-to-working age population ratio was 62.9%. In September 2006, the employment-to-working age population ratio was 63.2%. This is a decline of -0.3%. This is an indicator of how much employment growth has lagged behind working age population growth. How much has it lagged? 232,461,000 X -0.003 = -697,383 jobs.

So, rather than 3,000 or even 100,000 new jobs created in September, we actually have a loss 700,000 + jobs. Why the discrepancy, it seems the answer my friend is lying in the wind. It turns out the job growth is imputed from the last 5 years. These are not actual jobs that were created, but deceitful estimates that add jobs when they should be subtracting them.

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