Questions about economics for FReepers [Vanity]

When we see stats thrown around about how the economy added XXX,XXX jobs last month, does that take into account the number of first-time unemployment filings? In other words, if we see that the economy added 200,000 last month, is that a standalone or a net number? Is that 200,000 added, while (say) 350,000 first time unemployment filings means that there was actually a net *loss* of 150,000 jobs? Or does it mean that, with 350,000 unemployment filings, there were a total gross of 550,000 jobs added, which is balanced to a net of 200,000? Or do the two factors have nothing at all to do with each other?

Also, how is it that there can be hundreds of thousands of first-time unemployment filings in a month, and the unemployment rate actually goes down?

I have my MBA, and I can assure you there is nothing I ever understood about economics other than 2 things which I learned on my own:

1. The Laffer curve (which was not taught in my class).

2. Never invest in anything that eats (which was not taught in my class).

Ah, claims for unemployment benefits (either new or continuing) have absolutely nothing to with either the non-farm payroll number (which is from the Establishment Survey) or the unemployment rate (which is from the Household Survey.)

And of course all payroll figures are net.

All of this information is readily available at bls.gov and has been for many years.

The number of jobs added is a net figure. If 50,000 jobs were added, it could be that 2,000,000 were snuffed out and 2,050,000 were created.

The number is nothing but an estimate based on 60,000 surveys sent out monthly at random by the government. As mentioned above, it is completely separate from the unemployment numbers.

What you see in the labor reports are three different measures.

The Weekly Claims data that is cited every Thursday morning tracks the number of new claims for unemployment. The data is provided to the Bureau of Labor Statisdtics (BLS) by each states' labor department. Generally the breakeven point on growth in the labor market is said to be between 375K and 400K.Below that level you generally see improving monthly payroll and unemployment numbers. Above that range and unemployment moves higher. It should be noted that even in a booming economy, there would typicall be 325K-350K new weekly clams.

The monthly payrolls report is based on a survey of approximately 140,000 businesses and government agencies representing approximately 440,000 worksites throughout the United States. Employment is counted by the total number of persons on establishment payrolls employed full-or part-time who received pay for any part of the pay period that includes the 12th day of the month. The headline number that is frequently cited in news reports show the net change in the total payrolls number from the prior month.

Because unemployment insurance records relate only to persons who have applied for such benefits, and since it is impractical to actually count every unemployed person each month, the Government conducts a monthly survey of about 60,000 households to measure the extent of unemployment in the country. The basic concepts involved in identifying the employed and unemployed are: People with jobs are employed. People who are jobless, looking for jobs, and available for work are unemployed. People who are neither employed nor unemployed are not in the labor force. The unemployment rate is the number unemployed divided by the number in the labor force.

To try to figure out an absolute creation/destruction number forget about it. If you want a basic representation look at the adp numbers. The solo make my own job won’t be there but a base trend will be apparent. If you want to look out 6-12 months look at the baltic dry bulk index, and stay on top of china’s mfg production increase/decrease.

the laffer curve has been superseded by a combination of the curve and the present value of money. Its a wonderful explanation of how government theft causes poverty.

quick and dirty
cutting tax rates/total receipts in year 0/causing a ramped up net economic activity in years 2,3,4,5 ect) In the end its a way to finally quantify a dynamic scoring of tax policy vs the stupidity we are doing now

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