[lbo-talk] employment

Nathan Newman nathanne at nathannewman.org
Fri Aug 6 09:24:58 PDT 2004


----- Original Message ----- From: "Christian Gregory" <christian11 at mindspring.com>
>As for the criticism that these are based on "statistical games"--I >guess
it depends on what you mean by games. The model they use >is a non-sampling model, but it has to be, since new firms take a >while to be included in the sample. But the model they use is based >on historical data and update it quarterly. I don't know what else >you're expecting. Perhaps you could elaborate?

Look, I don't want to play a layman on these issues, since I'm not, but most people sort of expect when they hear "90,000 jobs were created last month" that this means that the Commerce Department went out and found that many new jobs, period. All adjustments add to the uncertainty that the numbers reported reflect reality rather than problems in the statistical adjustments.

Of course, the raw numbers can be deceptive as well in how we interpret them due to what is not sampled in the jobs report.

But the statistical adjustments do lead a lot of folks to wonder how much change in the economy is due to underlying reality and how much is due to odd statistical decisions made by the government statisticians.

Doug may feel that Crudele is accusing the BLS of political complicity with Bush, which I am not, but I have far less confidence that they've got the stats "right." I attribute this far more to poor funding of the statistical agencies, so they depend on poor data and have to extrapolate from there, but it's a problem that we are making large economic decisions based on pretty poor data.

nathan Newman



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