Conservatives Need to Remain Consistent On Unemployment

by: Brent Smith at the Common Constitutionalist

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For a decade or so, we conservatives had been like the town criers. Every time new employment numbers emerged we would cry out that despite what we all see, read and hear from the left wing media, all was not well. Throughout the entirety of the Obama reign, virtually everyone right of center – yes, even those establishment Republicans, would rightly claim that Obama’s unemployment figures were bogus.

And they were. Despite all other dreadful economic indicators, save for the phony Wall Street numbers, the unemployment rate continued to drop throughout Obama’s time. We on the right knew these numbers did not tell the true story, as the government was using the “official” unemployment calculator known as U-3.

This, as many know, does not give an accurate picture of real unemployment in this country. For years we have insisted that the more accurate U-6 data be used, as it takes into account not only short term unemployed, but also long-termed unemployed, discouraged workers who have just given up, and the underemployed, who wish to work full time yet can only find part time employment. This is the number conservatives insisted be reflected during the Obama years.

But then something odd happened after President Trump took office. read more

Which Recovery Summer Is This Anyway?

by: the Common Constitutionalist

So, I think we’re heading into our 4th or 5th recover summer. I’m not sure which. There’s so much recovering going on, it’s hard to keep up.

What?! Don’t tell me you don’t remember the summer of 2010, when Vice President Joe Biden declared, and kicked off his “Summer of Recovery” tour?

Politico proudly wrote in June of 2010: “BREAKING — OBAMA, BIDEN DECLARE “RECOVERY SUMMER”: Vice President Biden today will kick off “Recovery Summer,” a six-week-long push designed to highlight the jobs accompanying a surge in stimulus-funded projects to improve highways, parks, drinking water and other public works.”

Just how well has the recovery gone, you may ask? Well, with every recovery, there must be jobs…and lots of them. Let’s see how that portion of the “Recovery” has gone.

(All of the following italicized quotes are attributed to CNS News)

CNS News reports: “When Obama took office in January 2009, the labor force participation rate was 65.7 percent. By the beginning of 2013, the start of Obama’s second term, it had dropped to 63.6 percent. Since January 2014, when the participation rate was 63.0, it has continued to decline, hitting a 36-year low of 62.8 percent in May.” read more

Won’t Back Down

from:  at The Blaze

After being harshly criticized for questioning the veracity of the Bureau of Labor Statistics’ latest jobs report, former General Electric CEO Jack Welch on Tuesday evening responded to his detractors in a lengthy and unapologetic op-ed in the Wall Street Journal.

“Imagine a country where challenging the ruling authorities — questioning, say, a piece of data released by central headquarters — would result in mobs of administration sympathizers claiming you should feel ‘embarrassed’ and labeling you a fool, or worse,” writes Welch.

“Soviet Russia perhaps? Communist China? Nope, that would be the United States right now, when a person (like me, for instance) suggests that a certain government datum (like the September unemployment rate of 7.8%) doesn’t make sense,” he adds.

Welch goes on to reiterate his point, that is, that recent BLS data is not just faulty, but “implausible.”

“Unfortunately for those who would like me to pipe down, the 7.8% unemployment figure released by the Bureau of Labor Statistics (BLS) last week is downright implausible. And that’s why I made a stink about it,” he writes.

The former CEO continues, reminding readers that a) he is not working for the Romney campaign and b) BLS data is hardly free of error.

“The unemployment data reported each month are gathered over a one-week period by census workers, by phone in 70% of the cases, and the rest through home visits. In sum, they try to contact 60,000 households, asking a list of questions and recording the responses,” he writes, adding that the BLS even has an entire page in its “Handbook of Methods” dedicated to explaining the limitation of its data.

“Bottom line: To suggest that the input to the BLS data-collection system is precise and bias-free is — well, let’s just say, overstated,” he adds.

Later on, Welch directly addresses the tweet that got everyone in a twist:

Now, I realize my tweets about this matter have been somewhat incendiary. In my first tweet, sent the night before the unemployment figure was released, I wrote: “Tomorrow unemployment numbers for Sept. with all the assumptions Labor Department can make..wonder about participation assumption??” The response was a big yawn.

My next tweet, on Oct. 5, the one that got the attention of the Obama campaign and its supporters, read: “Unbelievable jobs numbers..these Chicago guys will do anything..can’t debate so change numbers.”

And here’s the controversial Oct. 5 tweet:

As he did when attacked by MSNBC’s Chris Matthews, Welch maintains that he was simply trying to raise a question, adding that, were he to do it all over again, he would definitely add question marks at the end of the Oct. 5 message.

“But I’m not sorry for the heated debate that ensued. I’m not the first person to question government numbers, and hopefully I won’t be the last,” Welch writes.

“The coming election is too important to be decided on a number. Especially when that number seems so wrong.”

Suspect Jobs Report

from: Breitbart

Oct. 5, 2012

Suspicion about the federal government’s September jobs report has fallen on Secretary of Labor Hilda Solis, who appeared on CNBC this morning and defended the numbers from the Bureau of Labor Statistics (BLS), claiming–falsely–that upward revisions of 86,000 jobs were from the private sector. In fact, the new number is entirely accounted for by upwards revisions to state and federal government payrolls.

The BLS reported that while only 114,000 jobs were created in September–which would have translated into a rise in unemployment from 8.1% to 8.2%–the unemployment rate fell dramatically to 7.8%. That unusual drop is the fastest in nearly three decades, and was unexpected even in the rosiest predictions.

One reason for the rise was an upward revision of 86,000 to the July and August jobs numbers–all of which came from a 91,000 increase in the estimate of public sector jobs. Private sector job estimates were actually revised downward by 5,000.

In addition, the BLS reported a large rise in the number of part-time jobs, adding 600,000 jobs to the total–a dramatic increase of 7.5%, not explained by any other economic indicators–and raising questions about whether the government had changed the way it counted part-time workers.

Solis was adamant today in defending both the revisions and the BLS’s methodology for counting part-time workers–relying largely on the upwards revisions for July and August jobs (emphasis added):

CNBC: We’re getting bombarded by people who do not believe the number. They believe this number was fixed and typed to coincide with Election Day. What do you say to them?…I’ll rephrase the question. A lot of people do not believe the 7.8 number. They believe that somehow BLS fixed this to coincide with the election cycle. What is labor’s response?

Solis: You know, I’m insulted when I hear that because we have a very professional, civil service organization where you have top, top economists that work at the BLS. They’ve been doing these calculations. These are — these are our best trained and best-skilled individuals working in the BLS, and it’s really ludicrous to hear that kind of statement, and I say that because just look at the — we have to look at what happens across the board, not just in one month, but look what happened in the last two months. We also saw revisions there upwards of 86,000 additional jobs added and this brings us now to 5.2 million private sector jobs across the board, we saw 104 private sector jobs created….

CNBC: Before I let you go, you say skepticism over the numbers are ludicrous. You say you’re insulted. Is there a danger, you believe, when large sections was country don’t believe the data. Not that it’s ever been considered gospel, but when you have disbelief how much danger is embedded in that?

Solis: I will tell you that we look at each report differently. We just saw revisions for the last two months and this happens. I mean, these are estimates that obviously, the BLS puts out. They do the best calculation, using the best measurements and tools and we’ve been using them for the past 70 years. We haven’t changed anything and the information that I received is given to me by our professional, civil service staff in the BLS.

Note that Solis describes the 86,000 upward revision as if it were an increase in private sector jobs, though in fact the increase came entirely from revisions to public sector payrolls by cash-strapped federal and state governments. Instead of shedding jobs, as previously claimed, governments have been adding jobs.

Collecting “Green Jobs”

A recent Bureau of Labor Statistics report counts 3.1 million green jobs in the U.S. economy, but the BLS defines these jobs so broadly that it includes even school bus drivers and trash collectors as “green” workers.

“Cheerleaders for the president’s program of green jobs mandates and spending point to the study as confirmation of green jobs’ economic importance,” said David W. Kreutzer, Research Fellow in Energy Economics and Climate Change in the Center for Data Analysis at The Heritage Foundation.

Kreutzer takes issue with the report as “an effort to count the number of green jobs as a way of justifying subsidies and mandates.”

“Just a little digging into the data shows that only a small fraction of the 3.1 million jobs could have been created by green subsidies and mandates.”

The BLS study defines green jobs as those “in businesses that produce goods or provide services that benefit the environment or conserve natural resources.”

Using this definition, the BLS counts 43,658 jobs in steel mills as green because the industry uses scrap steel and can be classified as an active recycler.

Similarly, 27 percent of all paper mill jobs, 30,473, are counted as green because mills use recycled paper.

Steel and paper mill jobs “do not fit in with the rhetoric of the new, clean economy that green jobs proponents use to justify expensive green policies — the sort of policies that brought the Solyndra debacle,” Kreutzer writes in the Heritage Foundation report.

The electric power generation industry is said to have 44,152 green jobs, but only 4,700 are in renewable power generation.

The nuclear power industry has 35,755 green jobs, according to the BLS, but since no new plants have been built-in the past 30 years, those jobs “are clearly not the result of any green energy or green jobs programs,” Kreutzer points out.

Other jobs considered to be green by the BLS include those in used merchandise stores (106,865 jobs), waste collection (116,293), school and employee bus transportation (160,896), leisure and hospitality (22,510), office furniture sales (14,888), septic tank cleaning and portable toilet servicing (13,313), radio and television broadcasting (9,297), fruit and tree nut farming (12,176), and social advocacy organizations (20,704).

Kreutzer concludes that the BLS’s “definition and collection mechanisms raise serious questions about how green those jobs are and whether their count can be a useful measure of the importance of green jobs in America’s economy and the effectiveness of green jobs policies.”

Attribution: Newsmax

Can’t Find a Job?… Join the Club

The True Unemployment Rate: 36%

By: John Hayward

How would you define “Unemployment?” Statistics on unemployment are bandied around in the media all the time. Changes in these statistics are hailed as good or bad news for the President, with varying degrees of emphasis from the news networks, depending on which party the President belongs to. But what do these statistics truly measure?

Would you define “unemployment” as measuring “people who want a job, but can’t get one?” This is, broadly speaking, the definition embraced by the Bureau of Labor Statistics. The trick to making those numbers dance lies in measuring “people who want a job.”

The widely reported U-3 unemployment metric, currently standing at 8.3 percent, is very aggressive in shaving off people who have not made recent efforts to find work. It is further distorted by massive “seasonal adjustments,” which made over a million people vanish into thin air last month.

This is why the official unemployment rate gets lower when the American workforce contracts. Workforce contraction is a very bad thing. People who simply cannot find work, and languish on unemployment insurance for years, are the last thing a prosperous country needs… but those people don’t count in the official unemployment rate.

For example, if everyone under the age of 25 abruptly stopped looking for work, it would be an economic disaster, but the official unemployment rate would go down, because the pool of people looking for work would get smaller.

(That’s not quite as far-fetched an example as it might sound, incidentally. Even the heavily-massaged U-3 unemployment rate currently sits at 23.2 percent for ages 16-19, and 13.3 percent for ages 20-24… and it’s about two percent higher for young men. Policies that increase the cost of labor, such as minimum-wage increases and mandated benefits, have a particularly punishing effect on young entry-level workers, since their labor has less intrinsic value than experienced older employees.)

This is precisely what has been happening under Barack Obama. The workforce is contracting with horrible speed, but it has the beneficial side effect of making the official unemployment rate go down a little, although 8.3 percent is still pathetic.

The Administration bounces happily before the cameras and announces its policies are “working,” and job creation is now “on the right track,” even as their best months post job creation only slightly in excess of population growth – and they’ve only had a few such months.

Pundits begin wondering if the old political rules that say re-election is impossible with unemployment over 6 or 7 percent might not apply to this President, if he can campaign on a slowly declining unemployment rate.

Another side effect of the way our unemployment statistics are prepared, and reported, comes when America’s employment picture is compared to the figures from other nations. Are the unemployment statistics reported from, say, Greece or Italy calculated in precisely the same manner as the American U-3 rate? If not, then how can we make valid comparisons between them?

Since the concept of people who aren’t looking for work is so fluid, and some of those people have clearly been persuaded not to look for work because of job-destroying government policies, it might be more logical to measure unemployment using the standard incorrectly offered by the Bureau of Labor Statistics for the U-3 rate: “total unemployed, as a percent of the civilian labor force.” That’s what the U-3 rate claims to measure, but it doesn’t, not by a long shot.

What is the current percentage of working-age Americans, eligible to participate in the civilian labor force, but not currently working? Answer: 36.3 percent.

That’s the worst labor participation rate in three decades, and it’s part of the worst employment picture we’ve seen since the Great Depression. Labor force participation is the number we should really be looking at, even more than the unemployment figures cooked up on the monthly basis by the Bureau of Labor Statistics.

Those figures have their uses as well, but it seems reasonable to measure the overall health of the economy by the number of people who simply are not participating in the labor force.

This would always be a much higher number than the BLS unemployment statistic, even when the economy was humming along at maximum power.

There are always going to be working-age people who drop out of the labor force, for reasons that have nothing to do with the nation’s overall economic health.

The labor force participation rate hasn’t exceeded 67 percent in the past decade, so we would be looking at a true “unemployment” number that bounces between roughly thirty and forty percent.

The difference between good and bad percentages is relatively small, which makes the true “unemployment” figure less sexy for news coverage, and therefore less useful to politicians… but it’s more logical to measure small changes in a large, accurate number than big changes in a small, largely fantastic number.

Writing at Red State, Rep. Jim Jordan (R-OH), who chairs the House Subcommittee on Regulatory Affairs, Stimulus Oversight, and Government Spending, offers an eye-popping chart measuring the effect of President Obama’s “stimulus” policies on workforce participation:

Jordan writes in support of the Jobs Through Growth Act, a package of dramatic reforms that includes a flat tax with two low rates, reduced corporate taxes, regulatory relief, and increased domestic energy production.  Those are the sort of changes America needs to make, if we want to do more than fiddle with imaginary unemployment numbers, whose very definition is subject to “adjustment” on a massive scale.  Those who define “unemployment” as “the number of working-age Americans who aren’t working” should waste no time on small reforms.

Real Unemployment = 11.4%, Don’t be Fooled!

From Zero Hedge: Real Jobless Rate Is 11.4% With Realistic Labor Force Participation Rate

One does not need to be a rocket scientist to grasp the fudging the BLS (Bureau of Labor Statistics) has been doing every month for years now in order to bring the unemployment rate lower: the BLS constantly lowers the labor force participation rate as more and more people “drop out” of the labor force for one reason or another.

[EC (Editorial Comment): The Labor Force Participation Rate is a measure of the active portion of an economy’s labor force. The participation rate refers to the number of people who are either employed or are actively looking for work. The number of people who are no longer actively searching for work are not included in the participation rate. In a poor economy, such as this, many people get discouraged and stop looking for employment and as a result, the participation rate, by percentage, decreases.]

While there are some floating speculation that this is due to early retirement, this is completely counterfactual when one also considers the overall rise in the general civilian non institutional population.

In order to back out this fudge we are redoing an analysis we did first back in August 2010, which shows what the real unemployment rate would be using a realistic labor force participation rate.

To get that we used the average [labor force participation] rate since 1980, or ever since the great moderation began. As it happens, this long-term average is 65.8% (chart 1).

We then apply this participation rate to the civilian noninstitutional population to get what an “implied” labor force number is, and additionally calculate the implied unemployed using this more realistic labor force. We then show the difference between the reported and implied unemployed (chart 2).

Finally, we calculate the jobless rate using this new implied data. It won’t surprise anyone that as of December, the real implied unemployment rate was 11.4% (final chart) – basically where it has been ever since 2009 – and at 2.9% delta to reported, represents the widest divergence to reported data since the early 1980s.

And because we know this will be the next question, extending this lunacy, America will officially have no unemployed, when the Labor Force Participation rate hits 58.5%, which should be just before the presidential election.

[EC: Someone, with more clout than I, must pick up this torch & carry it. Do any of our elected officials or those running for office have the courage to challenge these lies?]