Saturday, October 6, 2012

Cooking The Books, Pt II

Re: "Conspiracy theories on jobs report dismissed" (Saturday Nation), the Washington Post goes to great pains to validate the legitimacy of the unemployment numbers the BLS (Bureau of Labor Statistics) recently put out, but it is the two competing statistics that the BLS itself put out that calls their legitimacy into question. In the survey of businesses, the BLS concluded that 114,000 jobs had been added. In the survey of Households, the BLS concluded that 983,000 more people were now magically employed than last month. They both can't be right.
 
The problem is likely in the methods used by the BLS. They survey 66,000 households on a monthly basis. For them to conjure 983,000 jobs gained out of that sample size, only 400 additional households would need to answer "yes" when asked if they were employed. Here's the Kicker: the BLS itself admits that it changes out 25% of the households surveyed every month. So the 16,500 new households surveyed would need to have only the most infinitesimal skew in their reported employment to come up with close to a million new jobs: 100 households, to be exact, or .006 percent.
 
Considering that all professional pollsters preface the validity of their surveys as saying they are accurate to within "plus or minus 4%", it's hard to see how the federal government can claim a margin of error close to 7000 percent better. It is also interesting to note how tantalizingly close the reported job gain was to the magical mark of 1 Million. Kind of reinforces the notion that this result is Wishful Thinking engineered by bureaucrats in thrall to the Obama Administration, dialed back just a smidge to give it some validity.

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