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Here's a closeup of more recent years.
We can't even seem to get back to the pathetic trend that started in 2000, much less the trend that went from 1948 to 2000.
Should this really be a reason for celebration? MaxedOutMama seems to think otherwise and who am I to disagree?
May 6, 2011
Stocks rally as hiring spree surprises Wall Street
NEW YORK (AP) -- The biggest corporate hiring spree in five years ended a weeklong slide in the stock market.
Spot that hiring spree in the chart above and win a prize.
Source Data:
St. Louis Fed: Civilian Employment
11 comments:
Mark,
I came to the same conclusions as you and MaxedOutMama. It seems like the BLS engineers an upside surprise most months with a combination of optimistic assumptions, backward revisions, seasonal adjustments, and birth/death adjustments.
If you dig into the report, you will find a new trend has emerged since 2008. Most jobs lost are full time and many of the new jobs are part time. "Part-time nation" should be the title of a new book. Watch for it within a year!
Mr Slippery,
I don't think the BLS is overly optimistic. I just think its methods can break down at turning points.
Check this out.
Employment Situation Technical Note
Another major source of nonsampling error in the establishment survey is the inability to capture, on a timely basis, employment generated by new firms. To correct for this systematic underestimation of employment growth, an estimation procedure with two components is used to account for business births. The first component excludes employment losses from business deaths from sample-based estimation in order to offset the missing employment gains from business births. This is incorporated into the sample-based estimation procedure by simply not reflecting sample units going out of business, but imputing to them the same employment trend as the other firms in the sample. This procedure accounts for most of the net birth/death employment.
I think the theory here is that if an existing business dies, then there is probably a new competitor that took its place. In a healthy economy that is probably true. In an unhealthy economy I would argue otherwise.
Since I think we have an unhealthy economy, I don't think it is a given that if a business dies in a strip mall that a new one will appear and take its place. Let's just put it that way.
It may look overly optimistic for sure. I think the intent is to simply track the data as best they can though.
Unfortunately, predicting missing data using past data is fraught with error. In general and over the long-term maybe it is better than doing nothing, but perhaps not by much.
Put another way, I think their ultimate goal would be to be to average being right over the long-term. That means there will be times when they are wrong in one direction and it will be matched by times when they are wrong in the other direction.
This is one of those times when I definitely think they are wrong in the optimistic direction.
I could be wrong of course. If so, then I am wrong in the pessimistic direction. Time will tell.
Here's some bonus trivia.
We are 3.9 million jobs below the pathetic employment trend that started in 2000 (seen as the blue trend line in the charts).
How pathetic is that blue trend line? It is a 50,000 per month employment pace and is well below the pace of population growth.
Who would have thought it would have been such a lofty goal?
They are now supposedly adjusted the B/D model quarterly based on actuals so it is supposed to be more accurate, but that is not the sense that I get.
Maybe it would be better to report the numbers you can collect instead of trying to guess. Economics would have a better reputation if it did more measurement and less guessing. At least, that is my guess ;)
Mr Slippery,
Hello. This is your captain speaking. You'll be happy to know that we've just installed a birth/death model into our scientific instruments. We are currently cruising at a seasonally adjusted average cruising altitude of 32,000 feet. This may or may not give us a breathtaking view of the Rocky Mountains passing directly below us shortly. Thank you for flying BLS Airlines!
A lot of headlines noting the hiring in April... but leaving out the uptick in unemployment. Kind of like the other day with consumer spending. More than a few news outlets neglected to mention the effect of higher prices at the pump and other items on spending.
Wait until the robots take over, then we will see unemployment!
SurvivalAndProsperity.com,
And when unemployment was mentioned (at least on CNBC), it was said that it was due to more people looking for work as the economy was improving.
That's not exactly what the household data shows though.
GYSC,
Science fiction implies that robots will send one "terminator" at a time into the past to disrupt our lives.
Why just one?
Robots are going to clean up!
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