Is unemployment only 9.5%?

By Felix Salmon
November 10, 2009
report, right? Floyd Norris has taken a second look at it, and found something quite surprising:

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You remember Friday’s gruesome employment report, right? Floyd Norris has taken a second look at it, and found something quite surprising:

Unemployment rates remained steady at 9.5 percent. And the number of jobs actually rose, by 80,000. And the number of jobs for college-educated Americans rose more than in any month in the last six years.

That big hike in unemployment to 10.2%, and all the other terrible, horrible, no good, very bad jobs numbers turn out to have been entirely a function of the BLS’s seasonal adjustments. As Norris writes:

All this may be very reasonable, and there is no way I can think of to test whether the seasonal adjustments are reliable. But I suspect seasonal factors are less important this year, when the economy may be changing directions, than they normally are.

Now even the unadjusted numbers aren’t all sweetness and light, especially when it comes to those with less education. But it does make sense to think that seasonal factors aren’t going to be the same this year as they are in other years.

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Comments
4 comments so far

Oh, so contrary Felix! How astute of you to regurgitate day-old Norris and pretend it is telling us something new.

Calculated Risk at least provided some new perspective on the issue when it commented on the not-very-helpful musings by Norris. What did we get from the Felix the Fisherman? Nothing but by-catch.

Posted by Lazy Felix Does It Again... | Report as abusive

Is LazyFelixDoesIt Again Ben Stein?

Posted by KenG | Report as abusive

Felix, this is pretty horribly ignorant stuff. From Norris:

“For some reason, October is the month with the largest seasonal adjustment down in jobs”

oooh wonder why? Perhaps it could be that October is the month in which a new year’s graduate intake enters the workforce?? And so if only 80,000 jobs were added, this implies that a substantial proportion of that graduate intake did not actually find a job and remains on the unemployment rolls?

“there is no way I can think of to test whether the seasonal adjustments are reliable”

of course! no way at all! because these numbers are just made up out of thin air by the BLS, perhaps by throwing darts at a board! Seasonal adjustment is just some sort of funny Freakonomics stuff with no basis in statistical fact!

Every single recession brings with it a late autumn crop of people who have discovered seasonal adjustment for the first time and use the autumn seasonals to claim that “really” things are going better. It is followed by the apring/summer crew of permabears using the positive seasonals to claim that the government is covering up how bad things really are. The one follows the other with a regularity which is, well, seasonal.

Posted by dsquared | Report as abusive

Sure seems a lot worse than what it is. Even those with jobs are paying more for groceries, fuel, health insurance, taxes, tuition, etc. And many employed are part-timers with no benefits at all, so they’re struggling too.

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