Hiring not as good as reported

[kadee79]

Turns out hiring wasn’t nearly as strong in 2018 and early 2019 as the government initially reported — by about a half-million jobs.

The economy had about 501,000 fewer jobs as of March 2019 than the Bureau of Labor Statistics initially calculated in its survey of business establishments. That’s the largest revision since the waning stages of the Great Recession in 2009.

The newly revised figures indicate the economy didn’t get a huge boost last year from President Trump’s tax cuts and higher federal spending. They also signal the economy is a bit weaker than previously believed and could give the Federal Reserve even greater reason to cut interest rates in September.

“This makes some sense, as the 223,000 average monthly increase in 2018 seemed too good to be true in light of how tight the labor market has become and how much trouble firms are said to be having finding qualified workers,” said chief economist Stephen Stanley of Amherst Pierpont Securities.

The average 223,000 monthly increase in employment in 2018 — the strongest in three years — could be trimmed to 180,000 to 185,000, economists estimate.

Fewer jobs were created in restaurants, hotels, retailers and professional business services. Leisure and hospitality employment was reduced by 175,000, business services by 163,000 and retail by 146,400.

www.marketwatch.com/story/us-created-500000-fewer-jobs-since-2018-than-previously-reported-new-figures-show-2019-08-21

[Value Buy]

Does this mean the unemployment rate is also higher than reported?

[haapai]

I picked up the same article from Google News about a half an hour ago and a slightly earlier Detroit News story that emphasized which segments of the economy accounted for the largest parts of the adjustment. link

They are both early reports.

I want to know more about how the estimates could be that far off and just how unusual adjustments of that size are. I look forward to what economy wonks have to say about this late-breaking story.

Can you keep me posted if you see any analysis of how those numbers could be that far off?

[busymom]

They probably made up the numbers as they went.  That's what happens when you pick your buddies, or loyalists to run different departments, rather than  people who actually know what they're doing.  

[djAdvocate]

Aug 21, 2019 21:29:02 GMT -5 Value Buy said:

Does this mean the unemployment rate is also higher than reported?

there are lots of measures of UE.

the one the GOP liked to use before Trump was called, I believe, UE6.

I might be getting the number wrong.

[happyhoix]

I think unemployment gets complicated because there are people who are unemployed and actively looking for jobs, and there are people who just gave up trying to find one and no longer look - but are still unemployed.

I always thought it was hard to distinguish between someone who was a SAHM but could technically work, and someone who wants to work but is involuntarily a SAHM while she waits to find employment.