Let me start this blog by saying that I am not a professional statistician. I have chosen to address this topic to shed some light on this topic using some research and a layman's understanding of what I learned.
Every month we are fed by the Labor Department unemployment rates.
The rate for September raised many eyebrows. Several economists and management gurus questioned the validity and reliability of the method used for calculating the rate. Others went further to suggest manipulation for political reasons.
The reasons for this debate are many.
The most compelling explanation by the skeptics is that for the rate to drop from 8.1% to 7.8% 900,000 jobs would have been created in September. The implausible statistical quirk may be a result of the method used for determining the rate. Bureau of Labor Statistics (BLS) uses a household canvass to measure how many of us are employed. Professional statisticians advise us to discount these data because they lack reliability.
The most compelling explanation by the skeptics is that for the rate to drop from 8.1% to 7.8% 900,000 jobs would have been created in September. The implausible statistical quirk may be a result of the method used for determining the rate. Bureau of Labor Statistics (BLS) uses a household canvass to measure how many of us are employed. Professional statisticians advise us to discount these data because they lack reliability.
Can you be more specific?
For the rate to drop .3% in one month one of several factors must be in play, including:
First, the economy must grow rapidly and, as a result, it is creating lots of jobs. For this to be the reason, our GNP would have to grow by a healthy rate (5% or more) -- which was not the case for September. The number of jobs added during that month was a mere 114,000.
Second, since there is inadequate job creation millions of job seekers stop looking for work. That has been the experience throughout the recovery. For some reason, BLS does not count those who have given up looking.
First, the economy must grow rapidly and, as a result, it is creating lots of jobs. For this to be the reason, our GNP would have to grow by a healthy rate (5% or more) -- which was not the case for September. The number of jobs added during that month was a mere 114,000.
Second, since there is inadequate job creation millions of job seekers stop looking for work. That has been the experience throughout the recovery. For some reason, BLS does not count those who have given up looking.
Third, BLS counts part-time jobs as if they were full time contributing to further obfuscation of the real problem the nation faces.
So the numbers do not add up because they lack face validity.
We lost 9 million jobs during this recession. Just 5 million have been recouped. Even worse, the level of private sector jobs remains 13 million below the pre-crisis job growth trend.
The employment gap is a national crisis. 23 million people are either unemployed or under employed. These people are not a statistic, they are real human beings with needs, aspirations, and obligations.
Politicians, like Nero, are playing the fiddle while Rome is burning. Except that it is not Rome burning, but our fellow Americans who are suffering.
Where is the sense of urgency? Where is the bipartisan approach? We need action, not excuses, and soon. Real soon!!!
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