More evidence of phony unemployment numbers......

[Joanne98]

http://www.dailyfinance.com/story/careers/what-is-the-real-unemployment-rate/19556146/

I'd post it but it won't let me sorry.

[Warpy]

1. The first three paragraphs

Raghavan Mayur, president at TechnoMetrica Market Intelligence, follows unemployment data closely. So, when his survey for May revealed that 28% of the 1,000-odd households surveyed reported that at least one member was looking for a full-time job, he was flummoxed.

"Our numbers are always very accurate, so I was surprised at the discrepancy with the government's numbers," says Mayur, whose firm owns the TIPP polling unit, a polling partner for Investors' Business Daily and Christian Science Monitor. After all, the headline number shows the U.S. unemployment rate today is 9.5%, with a total of 14.6 million jobless people.

However, Mayur's polls continued to find much worse figures. The June poll turned up 27.8% of households with at least one member who's unemployed and looking for a job, while the latest poll conducted in the second week of July showed 28.6% in that situation. That translates to an unemployment rate of over 22%, says Mayur, who has started questioning the accuracy of the Labor Department's jobless numbers.

See full article from DailyFinance: http://srph.it/bjW9Zv

It seems his figures are about 50% higher than the U-6. We know those numbers are generally based on actuarial tables rather than reality, so that makes a great deal of sense.

[dana_b]

2. government numbers are b.s.

"However, Mayur's polls continued to find much worse figures. The June poll turned up 27.8% of households with at least one member who's unemployed and looking for a job, while the latest poll conducted in the second week of July showed 28.6% in that situation. That translates to an unemployment rate of over 22%, says Mayur, who has started questioning the accuracy of the Labor Department's jobless numbers."

I believe it. They are also taking into consideration underemployment, people who aren't on unemployment anymore, etc. We all see it all around us.

[Statistical]

24. "people who aren't on unemployment anymore,"

govt numbers have nothing to do with unemployment benefits.
Someone going on or "off" unemployment benefits doesn't change U-3 (or U-6) at all.

The BLS unemployment survey is totally separate from unemployment compensation.

Example:
you punch your boss in the face and are fired for cause.
you get no unemployment benefits
you are looking for a new job (and going to anger management)
per BLS you are unemployed.

[napi21]

3. It all depends on where those 1,000 people were located.

There are large pockets of unemloyment in the Country, but they do not represent the whole Country. I don't mean everything is GRAT in all those other places, but they sure aren't nearly as bad. I know only ONE person who lost their job during this major downturn and she got a job a month ago.

I said the unemployment rate was a BIG LIE during the Shrub tenure, but I have more trus in Obama. Besides, if h were going to lie about it, let's hope he'd do a better job at making it look like things were better!

[Clovis Sangrail]

4. the average household is 2.59 people

that works out to 10.8%
not all that far off from the actual numbers ... but then the method of getting there is far from precise.

I've always thought the govt's numbers on unemployment were garbage but this article tends to support that they're at least in the ballpark.

[jtuck004]

5. Just an fyi. The BLS unemployment rate is figured on the work force,

(a much smaller population), not households. From the BLS faq, here

"Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work."

So people who are not looking for work are not counted.

The BLS also does some massaging of the numbers, part of which is not released, so what we all see is not the raw data, but one that has had information they think is important added to raise or lower the total.

What TechnoMetrica did was survey people who are looking for work, just like the BLS. It would be incorrect to add in a bunch of people who are not looking, i.e. 2.59 per household, because it would include their kids in school, 90 year old parents, etc.

Statistically TechnoMetrica's survey is quite likely within the bounds of being + or - 5%, so their reported unemployment rate
could be as high as 27% or as low as 17%. Within that range it is quite likely very accurate, though it may not accurately represent unemployment among people without phones, or the homeless. That would likely cause it to be higher.

I should add - the highest unemployment rate I can find during the Great Depression was 25% (well, 24.9%, but it probably felt like 25%).

[Clovis Sangrail]

6. actually that's my point

the article repeatedly talks about them finding that 28% of household they called had "at least one person" unemployed but the BLS figures don't represent households.
As the average household is 2.59 people we should be able to divide that 28% by 2.59 and come up with something close to the BLS figues ... and we do.

I'm not saying that the BLS numbers are "right", that they don't massage the numbers, or that the unemployment rate is low.
I'm saying that the findings in this article don't seem to blow the BLS figures out of the water - if anything, to me, they tend to validate that they're not wildly inaccurate.

The fact that the article attempts to decieve the reader (and there's really no other way to describe what they're doing) doesn't lend credance to the premise.

[jtuck004]

7. That is very nearly the same way the BLS gets their data from the Census .

So it's not deceptive at all.

But measuring the two against each other would likely not yield a great comparison. I think Techo's figure includes underemployed, etc. So it would be better compared to the U6 BLS number, which is currently 16.5. Still quite a disparity.

[Clovis Sangrail]

9. 0o

The article states that they get a repsonse of at least 1 person per household is unemployed in 28.6%
That's 28.6% of *households surveyed.
They don't explain how they get to 22% unemployment from this so I won't use that number.
Had they made the question more granular "How many people, exactly, are in your household and how many are looking for a full time job" they may have had more useful results.
As it is all we can assume it the base line.. 1/per

Straight out to make things on a per person level you can divide that by the average number of persons/household.
28.6% / 2.59 (avg household) = 11.06%
It's not 9.5 but it's not wildly off considering (see below).

"but that counts elderly and schoolkids"
OK
Elderly and kids make up about 33% of the US population so let's remove 33% from our average household number.
28.6% / 1.74 (new avg household) = 16.43%

That's amazingly close to U6.
Unsuprising considering that:

Ginsburg says the biggest source of undercounting comes from people who can't find a full-time job that they're qualified to do, for instance recent college graduates who take part-time jobs at fast-food joints or retail stores. Today, the Labor Department estimates that 8.6 million people are in this category.

The federal government counts such people as employed. However, polls show that these folks actually consider themselves "unemployed" and "looking for a job," and probably accounted for a large chunk of TechnoMetrica's respondents.

If anything I'm suprised the TechoMetrica number isn't *higher.
My reference to them being deceptive is because the article build on the 28.6% household figure and the 22% (that comes from ?) to create a scene of gloom - that the BLS is pulling the wool over our eyes ... yet as I've shown their numbers really re-enforce the validity of BLS numbers.
To me that's deceptive journalism and tends to make me think less of anything they might have to say.

[jtuck004]

13. Yes, I think you are right, we could manipulate numbers all day

long to fit our notion, but there is not enough real info without knowing the questions, how they picked the sample, and all the calculations to know for sure.

I don't know what their motive would be to deceive, unless it is just to get in the press. But to intentionally do that just to make the BLS look bad, even for notoriety, would seem not much return against the credibility of their business, and they aren't the only ones who have some concerns about the BLS numbers, as a little googling will show. In addition, the BLS is run by employees who are just as capable of creating numbers that may not show true conditions for whatever reason, so doubting the credibility of their numbers without real evidence would seem just as likely. I think there are different pictures, but no intent to deceive by either group.

It also seems a piddling little argument against 30+ million people who are unemployed or underemployed, with little hope that the current congress or administration seems willing to do anything other than go on talk shows and argue about it.

[Clovis Sangrail]

17. lies, damned lies, and statistics ?

;)

We *can push the numbers to some extent in either direction.
I'm well aware that the BLS figures have been suspect for a long time by a lot of different people.
It's usually by the opposite of the pary in control of the executive but there's always bleed over from either/neither side.
*Somebody* has been deriding the govt unemployment numbers as fantasy _as far back as I can remember_ (Reagan).

Heck - *I've had a hard time with their numbers.
Which is why I find it sort of amusing that an article that's meant to invalidate the govt numbers on unemployment had the *opposite effect for me.

As to *why* they chose to skew their reporting... who know/who cares ?
Mabye the purchase is they hate Obama, or maybe they just think sensationalism sells papers and it gets their name out there.. it doesn't really matter.
The facts are the facts and while the numbers can be pushed in different directions you *have* to pay attention to what they tell you regardless of the skew applied by pundits.

[jtuck004]

18. Yes, something like that ;)

I do get your point about the opponents and their bias, and I see that as well. I tend to ignore them, because there is
frequently no substance.

But a lot of the criticisms predate Obama, so I am not sure they are really taking shots at his policies.

And I am not sure that is what they were after here. If there are a lot more people unemployed than is being
reported, policy responses could be inadequate, or even people's sense of urgency (which I find lacking all
around) could be affected.

Thank you for taking the cautionary view...

[westerebus]

21. 2.59

And where does this number come from?

[Curmudgeoness]

8. The reduction in income tax collected from 2008 to 2009 is 26%.

This is what I consider the effective unemployment rate, not considering the people who were unemployed in 2008. So that means that the true rate is higher than 26%, and this factors in the underemployed who are working at Walmart just to survive waiting for the economy for produce higher paying jobs. Underemployed may as well be unemployed for all the futility of trying to live on poverty wages.

[Clovis Sangrail]

10. what if it's not poverty wages?

Suppose somebody went from paying income taxes on $225k/year to paying taxes on $170k/year.
Measuring the drop in income taxes collected and calling that unemployment is going to include that person as well.

Actually ... that person would count *more towards your total than the guy who was making $45k/year and now works at Walmart making $25k/year.

[Curmudgeoness]

11. Good point. But isn't even that example person now underemployed?

Didn't we all expect to move up the ladder if we worked hard and faithfully? Not that I can find sympathy for your example person.

[Clovis Sangrail]

16. would *you consider that person "underemployed" ?

I don't think that would meet *most people's conception of underemployed... it certainly wouldn't meet mine.

Having been a techie in Silicon Valley in the 90's I know an awful lot of people who now make a lot less than they did at one time... but I have a hard time considering anybody making > = $100k/year "under employed".
I don't think I'd set the limit at poverty level but I also wouldn't set it at "having trouble make the payments on the Porche I drive on weekends"

If the term underemployed simply means "now making less than you once did" it kind of gives the discussions involving underployment a hollow ring.

[Statistical]

22. That number partially includes a $400 per person tax Credit.

Obama "making work pay credit".

While is doesn't sound like much when you figure there are 130 million people employed it adds up.

Still you are right assuming one compensates for changing tax rules (i.e 2011 tax cuts for rich will rise thus tax revenue will rise but that doesn't mean median income is rising) the tax revenue is a good metric.

[flyarm]

12. K&R

[Citizen Worker]

14. Not everyone who is unemployed qualifies for UE benefits

therefore these people would not be included in the BLS stats, would they?

[jtuck004]

19. Yes. The unemployment number is based on a survey taken

by the Census Bureau, started in 1940 as part of the WPA.

"Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work." The faq is here

Who is or is not getting unemployment benefits is unrelated.

[Statistical]

23. BLS survey has NOTHING to do with unemployment benefits.

On can not be receiving unemployment benefits and be considered employed by BLS.
One can received unemployment benefits and not be considered unemployed by BLS.

The metric is simply thing:
Unemployed (U-3): "Anyone currently unemployed who is will and able to work and has looked for work in last 4 weeks"

[Po_d Mainiac]

15. Screaming and waving hand

Little phrase seasonally adjusted

Look up what gets factored in.......I have. Historically the numbers may work out, but we ain't in chartered waters
ymmv

[fasttense]

20. Has the Obama administration changed how they count the unemployed?

I understand that when the federal government changes how they devise statistics, they tell you up front. I remember one change that was made a couple of months ago but I didn't think it would impact the count just how the count was reported.

So, if you think the bushes fudged the numbers and the Obama administration hasn't change their methods (or probably the people either) then why would you trust theses current unemployment numbers anymore than you would trust the bushes numbers?

There is a great advantage to monopolies to undercount the unemployed. Unemployed people are easily manipulated, wiling to take abuse and cost much, much less. The lower the unemployed numbers, the less pressure on monopolies to change their practices. This administration and the Democratic majority have no problem getting in bed with monopolies. I have heard almost nothing about trying to reinvigorate the anti-trust laws that are still on the books but have been ignored since Raygun. In fact no political entity that I'm aware of, has demanded a change in how the government manipulates the data for it's unemployment reports.

So, all in all, I think this administration is using the same data manipulations that the bushes used.

So, If you didn't trust bush, why trust these numbers that are using the same methods bush used?