Friday, October 5, 2012

RE: It's The Economy Stupid: A Game Changer???

Most often asked question this morning:  How did they come up with a 7.8% Unemployment Rate when the Change in Nonfarm Payrolls is well below the 150K constant employment rate?

 

My answer:  It’s statistics, not accounting.  It’s “fuzzy” numbers.  And this one appears to be the chia pet of labor statistics. 

 

 

John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury

Ph:  225-342-0013

 

From: John Broussard
Sent: Friday, October 05, 2012 7:40 AM
Subject: It's The Economy Stupid: A Game Changer???

 

Economic Event

Period

Economic Survey

Actual Reported

Original Prior

Revised Prior

Change in Nonfarm Payrolls

SEP

115K

114K

96K

142K

Change in Private Payrolls

SEP

130K

104K

103K

97K

Change in Manufact. Payrolls

SEP

0K

-16K

-15K

-22K

Unemployment Rate

SEP

8.2%

7.8%

8.1%

 

Change in Household Employment

SEP

 

873

-119

 

Underemployment Rate

SEP

 

14.7%

14.7%

 

 

The Unemployment Rate dropped to 7.8%.   Economists estimated that it was going to rise to 8.2%.  Is this a game changing number?

 

The job creation number was better, and the previous periods numbers were raised also.  The big change was in Household Employment.  No doubt about it, if these numbers don’t get revised significantly downward later on, these are good indicators for the economy.

 

John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury

 

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