The Campaign Spot

Seasonally Adjusted Jobless Numbers Too Good to Be True?

The final Morning Jolt of the week features some hurrahs for Kirsten Powers, a look at political movie-making, and then the big number coming out at 8:30 a.m. Eastern, the unemployment rate:

The Number That Will Be Driving the Day

This morning we’ll get some new unemployment numbers.

At Hot Air, Ed Morrissey looked at the early figures released by other sources:

The Bureau of Labor Statistics will release the official unemployment report for the month of February, but we have two previews this week to use as a gauge.  First, the ADP report predicts a net growth of 216,000 jobs in the private sector, improved from last month’s ADP report and about in line with the official January results from the BLS . . . Last month, ADP’s prediction got close to the official results for job growth.  That’s not an entirely normal event; ADP is frequently off in its predictions based on its payroll-service records.  Gallup has a little better track record, and their latest surveys predict a rise in unemployment . . . I’ll predict that the jobless rate goes up to 8.6%, with 95,000 jobs added in tomorrow’s report.

Over at MSNBC, there’s an assessment that’s more pessimistic than Righties might expect from that network’s site:

On Friday, the Labor Department is expected to report that the economy created more than 200,000 jobs in February with the unemployment rate holding steady at 8.3 percent.

It’s that last number — the portion of the workforce still out of work nearly three years after the recession ended — that remains stubbornly elevated.

“The labor market is still fundamentally weaker than five years ago,” said Craig Dismuke, chief economic strategist at Vining Sparks, a Memphis brokerage firm. “We are still in a big hole.”

Millions of American workers have been stuck in that hole for a long time. Some 43 percent of the 12.8 million unemployed Americans had been out of work for more than 6 months in January, the latest Labor Department data on the long-term unemployed. In all, nearly 24 million people are either out of work or underemployed. Those people aren’t out of work for lack of trying: there just aren’t enough jobs to go around. For every opening, there are four unemployed workers who need a paycheck.

Here’s the eye-catching part:

 The rapid decline in the jobless rate in the past few months has defied expectations; some economists argue that the widely-followed seasonally-adjusted numbers may be too good to be true.

Some suspect the government’s formulas for smoothing out seasonal factors may be inadvertently inflating the numbers. Gallup chief economist Dennis Jacobe figures that, without those seasonal adjustments, the jobless rate has actually been rising for the past three months, hitting 9.1 percent in January.

“We think that the improvement over the last few months dramatically overstates the underlying improvement,” said Goldman Sachs economist Andrew Tilton. “You will not see that rate of improvement going forward.” 

If steady improvement in the unemployment rate can save Obama’s presidency, and a double-dip recession dooms him, what does a level, 8.3 or 8.2 percent unemployment in November mean?

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