"To announce that there must be no criticism of the president, or that we are to stand by the president, right or wrong, is not only unpatriotic and servile, but is morally treasonable to the American public." -- Theodore Roosevelt


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Friday, February 4, 2011

Problem: Bureau of Labor Statistics Reports Unemployment Dropped to 9% in Jan.; Gallup Says Unemployment Rose to 9.8%


Now isn't this interesting...

Prof. Jacobson over at Legal Insurrection has linked to a report from the Department of Labor Statistics that claims the unemployment rate dropped to 9% in January 2011. Yet, Gallup released a report yesterday saying that unemployment rate rose slightly to 9.8% (as I posted here yesterday). That's quite a disparity.

Particularly interesting is the fact reported by Jacobson that the Department of Labor Statistics notes that only 36,000 jobs were created according to their figures-- yet that accounts for a .4% decrease in the unemployment rate (9.4% to 9%).

From the Department of Labor Statistics' report:

"The unemployment rate fell by 0.4 percentage point to 9.0 percent in January, while nonfarm payroll employment changed little (+36,000), the U.S. Bureau of Labor Statistics reported today. Employment rose in manufacturing and in retail trade but was down in construction and in transportation and warehousing. Employment in most other major industries changed little over the month.

[...]

"The unemployment rate (9.0 percent) declined by 0.4 percentage point for the second month in a row. (See table A-1.) The number of unemployed persons decreased by about 600,000 in January to 13.9 million, while the labor force was unchanged [emphasis mine]."

So let's see here. The number of unemployed people dropped by 600,000 people causing a .4 percentage point decrease (unless those two sentences are unrelated), yet only 36,000 nonfarm payroll jobs were created. And Gallup reports that unemployment rose slightly to 9.8% and didn't drop to anywhere close to 9%. Huh...

I'm sure there's an explanation for this difference. A very simple one.


UPDATE: It seems I was right. Don Surber offers this explanation to Glenn Reynolds (who apparently had the same question I did):

"The 'not seasonally adjusted' unemployment rate was 9.1% in December. It rose to 9.8% in January. In January 2010, it was 10.6%. This should explain the question from Glenn Reynolds as to why the official figure of 9.0% is so far below the 9.8% calculated by the Gallup Poll."

Simple... right?

However, Surber adds:

"A net gain of only 36,000 jobs in January shows the stimulus was a disaster.

"In fact, there may actually have been a loss of jobs in January.

"In 2010, revisions averaged a drop of 20,000 jobs a month (for example, last January, the government first reported a net gain of 14,000 jobs. That was quietly revised later to a loss of 39,000 jobs).

"It is true that winter is to blame for some of the smaller-than-expected job gain.

"But a net gain of 36,000 jobs in a nation of 300 million people is not enough to push unemployment from 9.4% down to 9.0%.

"Yet this is what the Obama regime wants us to believe.

[...]

"The administration’s manipulation of the numbers does not erase the fact that we very well could be headed to another recession.

"At a net gain of 36,000 jobs a month, it will take 18 years to get those 4 million jobs that President Obama promised in exchange for $787 billion.

"President Obama’s administration had expected a net gain of 146,000 jobs — still well below the net gain of 250,000 jobs necessary to sustain prosperity."

Better get ready to cling to religion and guns...

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