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The Employment Data is a DISASTER! Here's why the official numbers are so far off.
Analysis of BLS data accessed through FRED, the Federal Reserve Economic Data reporting website. | Dangus

Posted on 02/04/2022 9:39:04 AM PST by dangus

Each month, the Bureau of Labor and Statistics (BLS) asks, "how many people are out of work?" That number GREW by 184,000 last month. It's entirely possible to have a surge in unemployment AND a surge in employment at the same time, because sometimes there is a collapse in the number of people who are "out of the workforce." But that didn't happen.

Instead, the government readjusted its estimated size of the workforce up by over 1 million. Since the number of uemployed grew by a much smaller number, the government says, "Whelp, I guess they all got jobs." They didn't. Not in the past month, anyway.

Here's why this is so fundamentally deceitful: the estimate of the workforce wasn't off by a million because somehow a million Americans went back to work last year, and the government just hadn't realized it. It's probably off mostly because one million illegals stole American jobs, and those stolen jobs went unreported by corrupt businesses.

Here's the data. I just added workforce plus out of the workforce. This method is demonstrated to be valie because despite the jumpy monthly economic data, these two datasets yield a very steady trendline, except each January. What happens in January? The government uses Census data to readjust national population totals. You'll notice that in the last three years of the Trump administration the government had to reduce its estimate of the workforce. Again, probably mostly because the population of illegal aliens decreased. You'll also notice that each year during the Great Recession, the workforce estimates were reduced,... because yes, a lack of jobs and underwater housing sent illegal aliens back home. And yes, this is reflected in estimates of the illegal alien population. But as soon as the GDP started growing again, and the illegal aliens started to take the newly created jobs, we see that each year (2012-2016), the government starts having to correct their data higher again.

What this means is that the Civilian Workforce Level falsely shows an increase by 1,393,000 people. But only 62,000 people actually entered the workforce by leaving the "not in workforce camp." Unemployment grew by 184,000. And recent months have shown the workforce grew by about 130,000 (except the uncounted illegal aliens). So yeah, this months employment figures are off by about one million (1,017,000) people. Take away those million non-existent jobs, and you get a number (-545,000) much closer to the ADP report, which showed jobs jobs shrinking (job growth of -300,000) instead of surging by 467,000.


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KEYWORDS: employment; labor; vanity
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To: dangus
Not high school. I have a Ph.D. in economics and taught for 40 years before I retired, finishing up at a Big 10 university.

Stop what? I'm simply telling the truth and how monetary policy via the Fed can only do so much. If you want to use interest rates to curb inflation, devise economic policies that encourage economic growth, capital formation, and rising employment and labor force participation rates. It's monetary and fiscal policy working together that solves problems.

It's in vogue to think that, if I have 90% of the economic pie and you have only 10%, take 40% from me and give it to you to make income equal. Stupid move, as it kills economic incentive and growth and college graduates will continue to live in their parents basement.

Instead, devise policies that encourage me to invest and create new jobs. People forget that if the size of the pie increases in the presence of stable prices, you and I benefit with a larger income and a higher standard of living even if our relative shares are constant. A rising tide lifts all boats.

21 posted on 02/05/2022 7:38:56 PM PST by econjack (I'm not bossy. I just know what you should be doing.)
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To: econjack

Actually, it explains a lot that you’re a RETIRED professor.
You condescendingly write as if you’re teaching me something when you’re barely paying attention to what I’ve already written, and you sound like you’re reading from a textbook written in 1980. As I’ve said each time, you’re not wrong. But you also speak to absolutely nothing that has transpired since 2007, and really since long before that.

Case in point, this which is absolutely true, absolutely rudimentary, and absolutely irrelevant to anything I’ve written:

“It’s in vogue to think that, if I have 90% of the economic pie and you have only 10%, take 40% from me and give it to you to make income equal. Stupid move, as it kills economic incentive and growth and college graduates will continue to live in their parents basement.

“Instead, devise policies that encourage me to invest and create new jobs. People forget that if the size of the pie increases in the presence of stable prices, you and I benefit with a larger income and a higher standard of living even if our relative shares are constant. A rising tide lifts all boats.”


22 posted on 02/05/2022 7:59:31 PM PST by dangus
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To: dangus

Actually, I’ve stayed pretty active since my retirement and have written another 5 books since then. I also speak at various conferences.

I wasn’t trying to speak condescendingly at all. I was simply trying to explain things so readers not familiar with LM-IS curves derivation of monetary and fiscal policy could understand what I was saying. I think my advice on monetary and fiscal policy makes sense. I did pay attention to what you wrote and I think it is misguided, which is why I took the time to post my response.


23 posted on 02/06/2022 6:59:51 AM PST by econjack (I'm not bossy. I just know what you should be doing.)
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