Critics Question November Jobs Report Accuracy

Written by: John Landers

jobs report

After rising in October due to the federal government shutdown, the Department of Labor’s (DOB) November Employment Situation Summary reports that companies created 203,000. The number is better than forecast and continues a string of positive payroll gains. The lack of job generation has been a major criticism of an under performing economy that has yet to fully recover from the financial crisis of 2008 and Great Recession.

The latest data from the job report reduced the unemployment rate from 7.3% to 7%–the lowest unemployment level in five years.

November Jobs Details

According to the November jobs report, the private sector grew their payrolls by adding 196,000 jobs.  The Warehousing, health care and manufacturing sectors registered the biggest gains. Federal state and local government created 7,000 new jobs last month.  The BLS revised September (175,000 from 163,000) and October (200,000 from 204,000.)– 8, 000 additional jobs.

The average number of work week hours increased from 34.4 hours to 35.4 hours. This indicator portends an increase in hiring because employers tend to give current workers more hours before they begin to add more jobs.

A total of 10.9 million persons are unemployed. The long-term unemployment number remained stable at 4.1 million individuals or 37% of all unemployed individuals. On a year-over-year basis, this category of workers has dropped by 718,000.

In 2013, the U.S. economy has added 2 million jobs, which is the most since the period of January-November, 2005. Average hourly earnings rose from $24.1 to $24.15.

Critics Question Jobs Report Accuracy

Not all economists and Wall Street insiders agree with the Obama Administration assessment of an improving economy.  In November, furloughed federal employment returned to work after the force shutdown, which inflated hiring data. Naysayers also point to the following Jobs Situation category as proof of a much higher unemployment rate than the one actually focused on in the headlines:

Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force”

The BLS reports a 13.2 % rate of unemployment –when combined with the “underemployment” subcategory. Another criticism has been the quality of the jobs created.

The Employment Situation Summary does not include in unemployment numbers the people who have given up looking for suitable employment–  and a record number 932,000 reported in October.

Obamacare and the Job Market

According to economist John Lott, Obamacare may be the reason being that 96% of the new jobs created being part-time employment. Part-time employers totaled 7.7 million in November. The health care requirements do not apply to part-time workers so companies can avoid mandatory penalties for noncompliance.

A Mercatus Center  study reveals that the “impact of the recession and slow economic recovery on the private sector,” has had more of a negative effective on state economies than originally believed. Under the Obama administration, fellow researchers and authors of the report Keith Hall and Robert Greene say that 41 states had their private sector output declined from 2007 and 2012.


Critics Question November Jobs Report Accuracy

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