To be honest, I didn't know this is how they figured out the unemployment rate-
From Jack Welch: 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.
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.
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.....
Let's get real. 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.
Some questions allow for unambiguous answers, but others less so. For
instance, the range for part-time work falls between one hour and 34
hours a week. So, if an out-of-work accountant tells a census worker, "I
got one baby-sitting job this week just to cover my kid's bus fare, but
I haven't been able to find anything else," that could be recorded as
being employed part-time.
The possibility of subjectivity creeping into the process is so
pervasive that the BLS's own "Handbook of Methods" has a full page
explaining the limitations of its data, including how non-sampling
errors get made, from "misinterpretation of the questions" to "errors
made in the estimations of missing 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....
Meanwhile, we're told in the BLS report that in the months of August
and September, federal, state and local governments added 602,000
workers to their payrolls, the largest two-month increase in more than
20 years. And the BLS tells us that, overall, 873,000 workers were added
in September, the largest one-month increase since 1983, during the
booming Reagan recovery.
These three statistics—the labor-force participation rate, the growth
in government workers, and overall job growth, all multidecade records
achieved over the past two months—have to raise some eyebrows. There
were no economists, liberal or conservative, predicting that
unemployment in September would drop below 8%. http://online.wsj.com/article/SB10000872396390444897304578046260406091012.html?mod=WSJ_Opinion_LEADTop
I thought they got the jobless numbers from real numbers, not from surveys.
And it also explains how one can cook the books to make numbers look good, especially after you blew a debate.
Argentina Shows the Way
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