Gallup’s chief economist says that Friday’s jobs numbers should be “discounted” and suggests a new method of measuring unemployment that would paint a more accurate employment picture.
“The government’s Establishment survey shows there were 114,000 new jobs created in September — very close to the consensus of 113,000 — and not sufficient to lower the unemployment rate,” Dennis Jacobe wrote Friday.
“Friday’s BLS report of a drop to 7.8% in the Household survey seemed to surprise everyone, as has been the case on many occasions this year.”
Jacobe sounded a skeptical note about the nearly 900,000 jobs created, as reported by the Labor Department’s seasonally adjusted household survey.
“This surge in hiring seems surprisingly large given the current economy,” Jacobe wrote.
“The obvious conclusion is that a new employment measure is needed,” he added later.
Gallup does their own unemployment survey and consistently has similar results to the Bureau of Labor Statistics. In mid-September, they predicted the unemployment rate could be as low as 7.9 percent, but would probably be 8 percent or higher.
“[I]t seems unlikely that the government will report another major drop in the size of the workforce after showing an unadjusted decline of 1.27 million and an adjusted decline of 368,000 in the workforce in August,” wrote Jacobe in September.
Man have criticized the Friday jobs report, most notably former General Electric CEO Jack Welch. Welch attributed the dip in unemployment to “Chicago guys” cooking to books to make Obama look better after his abysmal debate performance last Wednesday night.
“President Obama’s economic policies are working,” Labor Secretary Hilda Solis said in a release Friday. “It is remarkable to consider the progress we’ve made despite the relative absence of bipartisan cooperation in Congress. If more lawmakers show a willingness to work across the aisle in the future, I’m confident we can accelerate these gains even more rapidly.”
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