Last month, the establishment media had an orgasm over the official U.S. jobless rate having declined to 8.3%.
In my post of Feb. 11, I called it baloney and pointed out how deceptive that 8.3% number is, due to the Bureau of Labor Statistics’ (BLS) “seasonal adjustment” and the exclusion of the long-term unemployed from the official jobless number. (See also my post, “Attn sheeple: U.S. economy is NOT improving,” Feb. 16, 2012.)
The skepticism is on point. Wolf Richter writes on Feb. 18, 2012:
“Now we’re in February, and unemployment after a year of fairly consistent improvement, is suddenly showing a sharp deterioration.
On Friday, Gallup’s mid-month unemployment reading, which covers the preceding 30 days, jumped from 8.3% in mid-January, the low point since the financial crisis, to 9.0%. An astounding increase. And its Job Creation Index confirmed that trend, dropping from +16 in January to +13 in February.
Worse, 10% of the employees in mid-February were part timers in search of full-time jobs…. Underemployment—a combination of the unemployed and part-timers who are looking for a full-time job—jumped to 19% from the mid-January reading of 18.1%. While Gallup’s unemployment reading has improved steadily over the course of 2011, the underemployment reading has simply gotten worse.”
There is another indicator besides Gallup’s mid-month jobless figure. It’s the Federal Reserve Bank of Philadelphia’s (FRBP) employment index.
The FRBP index reflects hiring plans by employers. Alarmingly, the index collapsed from 11.6 last month (January) to 1.1 in February. This means businesses aren’t hiring.
Over the years, the FRBP employment index has shown a strong correlation with the BLS jobs report. An index of 1.1 in February means only 50,000 new jobs were created, a far cry from the 243,000 the BLS claimed had been created in January (that figure, too, is deceptive).
Gosh, I wonder why we don’t hear or read about this news?