Today, the Bureau of Labor Statistics (BLS) released yet another confusing employment report. The payroll survey of employers showed job growth of 92,000 jobs last month. That figure can be considered tepid at best (economists expected 123,000). Yet the household survey showed the unemployment rate went down. How can that be?
According to BLS figures, since the Bush administration took office in 2001, the working age population of this country has increased by 15.8 million people. Although the workforce participation rate has dropped slightly, it remains just above 66%. This means that, in the last 69 months, the total US civilian workforce has grown by about 10.5 million people or 152,000 per month (this number matches conventional wisdom). In the same period of time, payroll jobs have only increased by 6.3 million or 91,000 per month (during the entire Clinton administration, job growth averaged 233,000 per month). That means that for every month the Bush administration has been in office, the number of payroll jobs has fallen short of the growth in the workforce by 61,000 jobs. Yet the "household survey", which only measures persons actively seeking work in a particular week, shows that today's announced unemployment levels are essentially unchanged since Bush took office.
If we are to believe the BLS figures, what they show is an average of 60,000 unemployed persons have fallen off the radar screen for each of the last 69 months. So what has become of those uncounted 4 million unemployed people? A small part of the discrepancy can be explained by an increase of people claiming to be self-employed (about 700,000). Another factor is the call-up of Reservists and National Guard to active-duty, whose jobs needed to be filled. However, that still leaves more than 3 million persons unaccounted for. If these people are not working regular jobs, then how are they earning a living? The obvious answer is that they are either engaged in illegal activity or they are destitute. This notion is supported by statistical and anecdotal evidence showing a marked increase in property crimes, drug dealing and other criminal enterprises, as well as an increase in homelessness. Either that is true, or the Bush administration is fudging the unemployment rate (or maybe a little of each). Anyhow, any way you look at it, the two surveys do not seem to jibe.
An interesting side-point is that of the 6.3 million new payroll jobs created since Bush took office, 1.68 million of them are actually government jobs. This represents an average of 24,300 civilian jobs being added to the federal payroll each month. What happened to the notion of "smaller government"?.
Historical Employer Payroll (Jobs) Data
Historical Household Survey (Unemployment) Data