Categorized | Opinion

Another Phony Employment Report

Manipulated statistics conceal stagflation reality

 

By Paul Craig Roberts
Institute for Political Economy

 

Today’s employment report from the Bureau of Labor Statistics shows 114,000 new jobs in September and a drop in the rate of unemployment from 8.1% to 7.8%. As 114,000 new jobs are not sufficient to stay even with population growth, the drop in the unemployment rate is the result of not counting discouraged workers who are defined away as “not in the labor force.”

According to the BLS, “In September, 2.5 million persons were marginally attached to the labor force.” These individuals “wanted and were available for work,” but “they were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.”

In other words, 2.5 million unemployed Americans were not counted as unemployed.

The stock market rose on the phony good news. Bloomberg’s headline: “U.S. Stocks Rise as Unemployment Rate Unexpectedly Drops,” http://www.bloomberg.com/news/2012-10-05/u-s-stock-futures-little-changed-before-payrolls-report.html.

A truer picture of the dire employment situation is provided by the 600,000 rise over the previous month in involuntary part-time workers. According to the BLS, “These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.”

Turning to the 114,000 new jobs, once again the jobs are concentrated in lowly paid domestic service jobs that cannot be offshored. Manufacturing jobs declined by 16,000.

As has been the case for a decade, two categories–health care and social assistance (primarily ambulatory health care services) and waitresses and bartenders account for 53% of the new jobs. The BLS never ceases to find ever growing employment of people in restaurants and bars despite the rising dependence of the US population on food stamps. The elderly are rising as a percentage of the American population, but I sometimes wonder if employment in ambulatory health care services is rising faster than the elderly population. Whether these reported jobs are real, I do not know.

The rest of the new jobs were accounted for by retail trade, transportation and warehousing, financial activities (primarily credit intermediation), professional and business services (primarily administrative and waste services), and state government education, where the 13,600 reported new jobs seem odd in light of the teacher layoffs and rise in classroom size.

The high-tech jobs that economists promised would be our reward for offshoring American manufacturing jobs and tradeable professional services, such as software engineering and IT, have never materialized. “The New Economy” was just another hoax, like “Iraqi weapons of mass destruction” and “Iranian nukes.”

While employment falters, the consumer price index (CPI-U) in August increased 0.6 percent, the largest since June 2009. If the August rate is annualized, it means bad news on the inflation front. Instead of bringing us high tech jobs, is “the New Economy” bringing back the stagflation of the late 1970s? Time will tell.

*************

Paul Craig Roberts is a former Assistant Secretary of the US Treasury and Associate Editor of the Wall Street Journal.  He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. His latest book,  Wirtschaft am Abgrund (Economies In Collapse) has just been published.

One Response to “Another Phony Employment Report”

  1. bill masson says:

    Its such BS this so called jobs report .We should know the real numbers .I think some years ago it took something like 220.000 jobs a month just to keep up with pop growth.

Trackbacks/Pingbacks


Leave a Reply

HumSentinel on Twitter

RSS Progressive Review

  • A short history of the economic American
    Sam Smith, Shadows of Hope, 1994 - Encomiums to the wonders of market forces fill speeches and media reports. One National Public Radio reporter even went so far as to describe a form of government called market democracy, apparently a blend of the Bill of Rights and the Wall Street Journal editorial page.In fact, most free workers in this country were self- […]
  • Govrnment links
    Project on Government Oversight Government Accountability Project Wikileaks   WHISTLEBLOWERS Thomas Drake Bill Binney Chelsea Manning Project on Gov Oversight Edward Snowden […]
  • Another reason to like whistleblowers
    Guardian, UK - A new study tracking the economic effects of whistleblowers has found that people who come forward to report wrongdoing helped the US government secure $21.27bn more in fines over 35 years.The study, conducted by researchers from Arizona State University, American University, Texas A&M University and University of Iowa, set out to discover […]
  • Reminder to the Duke and Duchess of Cambridge: We won the revolution
    Daily Mail, UK - American journalists have been given a dressing down about how they dress up ahead of the Duke and Duchess of Cambridge's royal visit next month.The Duke and Duchess will visit New York City and Washington, DC, for three days, their first official visit to the US in three years.Reporters have been given a strict dress code, reminding th […]
  • Word
    The problem with doing nothing is not knowing when you're finished. - Ben Franklin […]
  • Pocket paradigms
    We tend to discount the importance of unplanned moments because of our fealty to the business school paradigm in which change properly occurs because of a careful strategic plan, an organized vision, procedures, and process. During the past quarter century when such ideas have been in ascendancy, however, America has demonstratively deteriorated as a politic […]
  • Mitch
    From 50 years of our overstocked archivesSam Smith, 1990 - This spring, when homeless activist Mitch Snyder announced he was going to retreat to a monastery for awhile for reflection and renewal, I felt pulled to drop him a note thanking him for his witness, for the good it had done, for the wisdom and encouragmeent it had given others. In the note I quoted […]
  • When was the last time a Mexican cut your pension?
    Sam Smith, 2006 - Those wishing to test the extent of the immigrant problem might want to conduct this quick test:1. Has a Mexican ever fired or laid you off?2. Has the plant you worked for until it was sent overseas been bought by Mexicans or is it still owned by the same people you used to work for?3. Has a Mexican ever cut your pension or health benefits? […]
  • Who's an American citizen?
    1600s Most of various tribes scattered throughout the continent didn't know whether they were Americans as there was no one to tell them 1774 Continental Congress leaves it to each state to decide who shall be a voting citizen 1776 Full citizenship to white male property owners, with six states granting it to all white males whether they had property or […]
  • What's up: Thursday afternoon
    Exit polls found that 62% of Democrats voting said they never attend any sort of religious event. For Republicans the figure was 35%. […]
  • Neil Young starts Starbucks boycott over GMO suit
    Rolling Stone - Neil Young is seeking a new source for his daily latte. The rocker announced on his website this week that he's boycotting Starbucks over the coffee company's involvement in a lawsuit against the state of Vermont's new requirements to label genetically modified ingredients."I used to line up and get my latte everyday, but […]
  • The art of the counter-boycott
    Jesse Walker, Reason - Palermo, the largest city in Sicily, is at the heart of mafia country. In the past, trade association surveys have shown that about 80 percent of the town's shops were paying pizzo. But now more than 900 Sicilian firms, a majority of them in Palermo, are publicly refusing to give money to the mob, thanks to one of the most remarka […]
  • What's up: Thursday morning
    Dissenters within the National Security Agency, led by a senior agency executive, warned in 2009 that the program to secretly collect American phone records wasn't providing enough intelligence to justify the backlash it would cause if revealed, current and former intelligence officials sayThe Green Party of Germany announced that a coalition agreement […]
  • Bank of North Dakota outperforms Wall Street
    Counterpunch - While 49 state treasuries were submerged in red ink after the 2008 financial crash, one state’s bank outperformed all others and actually launched an economy-shifting new industry.  So reports the Wall Street Journal, discussing the Bank of North Dakota and its striking success in the midst of a national financial collapse led by the major ban […]
  • Oaklanders find rank choice voting easy
    East Bay Express - In the weeks before the November 4 election, numerous news stories in the mainstream press focused on whether ranked choice voting was too complicated for Oakland voters to understand. At one point, Governor Jerry Brown, an Oakland resident and a longtime opponent of RCV, called the voting system "complexifying." But results of t […]