sailingaway
02-05-2011, 12:12 PM
We know that when benefits are exhausted people drop out of the counted labor force for unemployment numbers, and I assumed that was what was behind the 'official govt numbers' dropping this month. But apparently the new census numbers let them 'calculate out' a sudden 504,000 people from the work force as well.
Pretty dishonest when it is then portrayed as a 'drop', but there you are....
Update: I'm not sure if this is the key, so correct me if you think I am wrong, but it looks like BLS started using new labor force numbers starting January 2011, based on the most recent census data:
"Effective with data for January 2011, updated population estimates have been used in the household survey. Population estimates for the household survey are developed by the U.S. Census Bureau. Each year, the Census Bureau updates the estimates to reflect new information and assumptions about the growth of the population during the decade. The change in population reflected in the new estimates results from adjustments for net international migration, updated vital statistics and other information, and some methodological changes in the estimation process."
In Table B just below this disclosure, BLS describes the effect of the data change on the December 2010 numbers, and low and behold, it decreases the "civilian labor force" by 504,000 people. Would this downward adjustment explain why over 500,000 appeared to find jobs even though almost no new jobs were created? If this is correct, then BLS simply took 504,000 people out of the labor force which would have the effect of dropping the unemployment rate (which is based on people in the labor force). Tell me why I am wrong, because I must be wrong, it cannot be so simple, or I must be misreading something.
http://legalinsurrection.blogspot.com/2011/02/houdini-economics-unemployment-rate.html
Pretty dishonest when it is then portrayed as a 'drop', but there you are....
Update: I'm not sure if this is the key, so correct me if you think I am wrong, but it looks like BLS started using new labor force numbers starting January 2011, based on the most recent census data:
"Effective with data for January 2011, updated population estimates have been used in the household survey. Population estimates for the household survey are developed by the U.S. Census Bureau. Each year, the Census Bureau updates the estimates to reflect new information and assumptions about the growth of the population during the decade. The change in population reflected in the new estimates results from adjustments for net international migration, updated vital statistics and other information, and some methodological changes in the estimation process."
In Table B just below this disclosure, BLS describes the effect of the data change on the December 2010 numbers, and low and behold, it decreases the "civilian labor force" by 504,000 people. Would this downward adjustment explain why over 500,000 appeared to find jobs even though almost no new jobs were created? If this is correct, then BLS simply took 504,000 people out of the labor force which would have the effect of dropping the unemployment rate (which is based on people in the labor force). Tell me why I am wrong, because I must be wrong, it cannot be so simple, or I must be misreading something.
http://legalinsurrection.blogspot.com/2011/02/houdini-economics-unemployment-rate.html