Friday, October 5, 2012

Unemployment Rate Drops to 7.8%

7.8%? Something is seriously amiss here. That is not to say that the government had its thumb on the scale. Playing with the numbers, even if it was possible, would be much more advantages next month with those numbers coming out a few days before the election. As it is, this outlier (assuming of course, as most have, that it is) may end up hurting the Obama administration if the number snaps back up a month from now. The U-6 number (underemployment + unemployment) rate stayed the same, and the numbers look as bleak as they have for a while if you compute what the numbers would be if the participation rate was what it was before the recession.

Obama will undoubtedly show this as moving in the right direction, finally below 8%, but he should be careful to avoid a Romney counter that 'Obama thinks 7% is apparently the new 'golden number''.

"The Bureau of Labor Statistics delivered yet another disappointing jobs report. In September, the economy only added 114,000 jobs, and while the jobless rate dropped to 7.8%, that mainly came from a mid-year adjustment last month on the number of current jobs:

The unemployment rate decreased to 7.8 percent in September, and total nonfarm payroll employment rose by 114,000, the U.S. Bureau of Labor Statistics reported today. Employment increased in health care and in transportation and warehousing but changed little in most other major industries.

The unemployment rate declined by 0.3 percentage point to 7.8 percent in September. For the first 8 months of the year, the rate held within a narrow range of 8.1 and 8.3 percent. The number of unemployed persons, at 12.1 million, decreased by 456,000 in September.

Looking at the internals, there were few true bright spots, but at least it wasn’t as bleak as the last couple of months. The U-6 number, which captures unemployment and underemployment as well as the marginally attached, stayed the same as in August at 14.7%. The civilian population participation rate rose a tenth of a point to 63.6%, exactly where it was in the 1982 midterm election, and only missing the 31-year low set last month.

The number of unemployed dropped 456,000 last month, while only 114,000 jobs got added. That either means that 342,000 people left the US, or they left the work force in one way or another. In the household survey, though, the number of people with jobs rose by 873,000 — a very strange outcome that makes it appear that more than one tweak has been done to previous data. (The +873K is in the seasonally adjusted number, by the way.)

No comments:

Post a Comment

Related Posts with Thumbnails

Like what you read; Subscribe/Fan/Follow