“There are three kinds of lies: lies, damned lies, and statistics.”
This quote from Mark Twain rings as true today as it did in his time. The big government circle jerk is at it again, manipulating employment data to show America the illusion of a real recovery thanks to the policies of our fearless leader, who shall not be named, frankly because I’m not too fond of the Golfer-in-Chief. So what are the whiny, super rich, predatory capitalists complaining about now? Why, the employment data, of course. Gallup’s CEO, Jim Clifton, dove into the recently released employment figures and had quite a bit to say about how misleading the data is.
That’s right, the 5.6% unemployment number that everyone is getting all excited about is pure crap. Now, it isn’t so much a lie as it is misleading because of what pool of data is used. 5.6% is the U3 unemployment number, which has been used by politicians for years to make it look like they are doing a good job because it leaves out extreme underemployment and people no longer in the work force. Many people educated and qualified to work good, full time jobs are working low paying part time jobs and people who gave up looking for work six or more weeks ago aren’t counted at all in the U3 employment numbers. Just for your information, the number that includes those no longer in the workforce and the grossly underemployed is the U5 and U6 unemployment number, which is a much more accurate gauge of employment in America. According to Gallup’s CEO, only 44% of American adults have a 30+ hour work week with a regular paycheck, and to replenish the middle class we need that number to be over 50% as well as 10 million new, good full-time jobs. Hell, I couldn’t find a sketchy massage parlor that would stroke me as well as the US Department of Labor strokes their numbers.
Of course, this isn’t the first instance of data stranglebation by the federal government recently. Zero Hedge called out the Q3 2014 GDP surge as a fraud by pointing out that the Affordable Care Act’s contribution to GDP in the first quarter of 2014 was taken out because the polar vortex could be blamed for poor GDP numbers. So where did all that Obamacare contribution to GDP go? Why, into the Q3 GDP numbers of course! That’s right, the Q3 numbers were, once again, weak, so they needed to pump up the numbers right before the November elections, so they put a year’s worth of Obamacare into Q3 2014 GDP. So, when you think about it, this whole U3 unemployment vs U6 unemployment limp biscuit is no real surprise..
[via LinkedIn]
Image via Shutterstock
*Bitches about how statistics are lies*
*Uses statistics to prove point*
I said statistics coming out of the government are lies. The statistics I used came from the article by Gallup’s CEO.
Extra funny that the U6 is a BLS statistic just like U3, both are released once a month. http://www.bls.gov/news.release/empsit.t15.htm
Maybe sit the next play out?
No.
Why is the author getting ragged on for this? Does anyone really believe that underemployment isn’t a massive problem? More graduates/qualified individuals than jobs available? Hell a law school graduate may be making your jack and coke Friday night, and you don’t even know it. There are people with college degrees digging ditches and hammering nails. All of which the whole “everyone should go to college/have an opportunity to do so” is such a sham.
The real problem with the everyone should go to college sham is people graduating with degrees in art, gender studies, etc. and then expecting a job. Sad fact of reality it’s extremely hard to find jobs in those degree fields and is a waste of time/money.
I agree it is a problem, but to think this is the first instance, President, institution to manipulate or selectively pick the statistic that best suits them or their point is naive.
He’s getting ripped apart because there is no basis for his argument. The U3 has always been the number reported. He calls the 5.6% unemployment crap when it’s the same number that has been reported for decades.
Underemployment is a problem right now. But comparing that vs. historical U3 numbers tells you jack shit.
Just because it’s the number that’s used doesn’t make it right or the best. I prefer a more accurate picture, even if it isn’t the most used statistic.
Accuracy comes from comparing historical U6 to current U6, not historical U3 to current U3. You cannot just say today’s unemployment number is misleading without acknowledging that every single unemployment number is misleading.
This was just written to purposely take a side on an issue and turn this into a right/wrong scenario. And this mentality is ridiculous, especially from an educated individual.
The average, every day person who hears, “5.6% unemployment YAY!” on the news or from the White House or wherever doesn’t understand the difference between U3, U5, and U6. That was my point. They’re touting this number like it’s a big achievement, but the true unemployment (U5) and underemployment (U6) are significantly worse than in past years. I never once said it was just this administration or that it’s a new thing.
In other news I still can’t submit PGP’s from my phone. PGP
I like it. An article with substance.
You kind of said a lot of nothing. True, the U3 isn’t the true unemployment rate, but it is the rate that has been used for decades, so it is still a fair comparison against historical unemployment rates.
http://www.macrotrends.net/1377/u6-unemployment-rate
The U6 has still steadily declined since Oct-09. While still high, it is undoubtedly trending in the correct direction. And a 6.2% drop in U6 from it’s peak, with only a 4.5% drop in U3 from the same time shows that people are actually getting back into the workforce.
It’s honestly the best shape the job market has been in since I graduated, and there are definitely good jobs out there for those willing to find them.
Then how do you explain how the difference between the U3 and U5 and the U3 and U6 is the largest it’s been since before 1994, according to your link? Sure, all three numbers are trending in the right direction, but the U6 is still double what the U3 is. That gap means the largest percentage of the work force in at least the past 21 years is working part time.
Recoveries are always slow after a major financial crisis.
The truth is economists don’t have a good idea of what policies and regulations would prevent asset bubbles and still allow growth. Two major crises in a century don’t give a good sample size. The economy still sucks for a lot of people, and the government isn’t helping on either side of aisle. We Americans are going to have to bootstrap ourselves to full employment. The gap will narrow if employment keeps growing and business and consumers keep investing and buying. Compared to our fellows across the pond our growth has been remarkable.
The biggest opportunities for increasing our growth rate actually reside at the state level like removing licensing requirements for professions that don’t need them. Classic supply side stuff there. Sadly no one pays attention to those elections so state houses make congress look like the NYY vs. a little league team.
The opportunity is repealing Obamacare. Countless business have stated they have had to cut jobs and reduce hours for employees to try and skirt the financial burden forced on them by this terrible administration.
You are right - the biggest opportunity at the federal level is in health care. The problem is neither side can actually do anything good because they rely on votes from super liberals and/or old people that scream bloody murder if anything is changed. So repealing ACA doesn’t actually get you anywhere without wholesale reform.
The solution is somehow you have to get the incentives to where health care consumers shop by price and quality for all services like you would any other product. Right now most hospitals can’t even give you a cost estimate for a certain procedure. The best idea I have heard of is repeal the tax break for employer health care, give it to individuals as a credit in a health savings account, then everyone will better off buying high deductible insurance themselves and rationing their funds accordingly. The market will be more competitive and we can actually get some productivity out that sector instead of more bloat. If you can make something like that happen politically then you should run for President. Or at least the house if the age requirement holds you back.
The day that insurance companies are not traded on Wall St is the day the consumer wins.
The gap has nothing to do with numbers being “massaged.” Unemployment has always been shown as the U3 number is my point. You’re just spouting one-sided rhetoric by complaining like you are.
And I’m not sitting here denying that there was a financial crisis. A pretty substantial one that we have been recovering from. The U6 will always have a larger gap from the U3 during a financial crisis. My point is that the recovery is happening, and just bitching that the U3 looks way better than the U6 is irrelevant and is just the go-to argument of playing party politics.
Yes but this slow? It will be interesting to see what happens now that oil is crashing. Since some people believe that is the main reason the economy is doing so well in the first place.
http://www.ijreview.com/2015/01/239402-believe-one-state-solely-responsible-net-job-growth-since-2007/
“Some people” would be wrong. The U.S. is mostly being helped by Saudi deciding not to decrease supply in light of increased demand (which is what’s causing the crash). Sure, it’ll hurt some of the more expensive drilling operations since the price per barrel has plummeted, but the overall U.S. dollar is getting strengthened by the EU responding to this by printing more money.
Plus, it fucks over Iran, Venezuela, and Russia. I’m sorry that some Texas or North Dakota oil baron may lose millions but… don’t they already do that regularly anyway?
This is true, the author should be blaming news outlets for only reporting U3 numbers, not the government statisticians that release U3, U5, and U6 every month? Anyone serious checks all the datasets because each has its weaknesses and strengths.
This is the entire point I have been trying to make. The author shapes this as if the current administration is being purposefully deceitful. It’s no surprise that the U6 is so much higher, and if you wanted to be outraged at this, 2010 was a much better time than present day.
This is spot on. In a world where facts and data mattered, we would use the labor force participation rate to talk about the economy’s performance.
Yeah the administration came out with their highly optimistic employment numbers right before the 2012 election then quietly corrected them after Obama was reelected. Same administration that will take credit for low gas prices while doing nothing short of trying to end the drilling that has caused them.
Yeah, that’s not what happened. Like, at all. You and Jack Welch need to knock it off.
And I agree that presidents don’t have much power over gas prices. But if he’s going to get blamed for when they’re high, he might as well get credit for when they’re low.
ZeroHedge article.. well played. I’ve been saying this same thing for a year or two now as well.
You’re one of “those” people, huh? I’m surprised you didn’t just take up the mostly-useless talking head point about the workforce participation rate, too. For shame.
The “official” (U3) unemployment rate only takes into account those participating in the workforce, genius.
I’m referring to the nonsense you spouted about the government “massaging” the numbers. Usually when people decide to put on their tin foil hat and pull this “the government is lying about unemployment!!!1111″ nonsense, they eventually move to the workforce participation rate red herring.
Am I just going too fast for you to keep up? Should I slow down? I’m just skipping ahead in what’s undoubtedly your playbook.
Oh, so you’re not offering a counter argument to my point that the 5.6% unemployment figures spouted by government officials are misleading, you’re just complaining about how I’m making the argument, which is a factually correct way of making the argument. Good trolling, I’ll up-vote your comment for that.
My counter-argument is that the government has always used the U-3 as the official stat, and has always reported the full stats as well. Everything has been on a downward trend, so your doom and gloom isn’t based in reality.
You’re acting as if this is something brand-new to this administration either makes you woefully ignorant, or deliberately obtuse.
Please explain how the workforce participation rate is unrelated. Please.
The TL;DR version of it is that a majority of the “controversy” is really that most people don’t understand how aggregate data works, and that it’s been on a downward trend since 2000 anyway. There is a good chunk of it that’s a result of “discouraged workers,” but a significant majority is just an aging population in action.
When did this become fox news??
This article should’ve been weeded out as the propaganda garbage it is. This site officially is worthless.
You’re right, everything is going perfectly, right?
Killing that straw man argument today, huh?
Last I checked, Gallup’s CEO doesn’t work for Fox. Good reading comprehension.