http://www.economicpolicymonitor.com/About Those Poof, Pow, Bam Employment Numbers
The Bureau of Labor Statistics released data today that showed job creation exceeded forecasts and the unemployment rate unexpectedly declined in March. The number of people on payrolls grew by 180,000, the most in three months, and the February increase was revised higher to 113,000. The jobless rate fell to 4.4 percent, matching the lowest since May 2001. The total employment was reported at 146.3 million. But don't throw a party just yet.
There are several problems with this data. The first being the data shows that construction employment increased by 56,000 in March. Given the collapse of the housing market, this is unlikely. Some of it may have to do with February numbers being too negative, where adverse weather contributed to a more than normal decline that month--and thus the bounce up this month versus February. In reality, the construction industry has shown no net growth since employment peaked in September 2006. Over this span, job gains in the nonresidential components of construction have been more than offset by losses in the residential components.
Second, manufacturing employment continued to trend down over the month (-16,000), with declines in furniture and related products (-4,000), computer and electronic products (-4,000), textile mills (-2,000), and paper and paper products (-2,000). Not good.
Finally, the BLS in March added a magical 128,000 to the number employed with what they call their Birth/Death Model --it's not real counted new employment. It's some kind of estimate of an estimate, i.e., they guess how many new businesses are formed, how many die. They mix this all together with no hard data--and viola--new employment!
Breaking down the numbers and taking out the magical 128,000 and the construction gain of 56,000 and poof, pow,bam--the 180,000 increase becomes a decrease in employment of 4,000.
Labels: economy
posted by Raymond Weber @ 12:03 PM