The Real July Jobs Report

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Note: 6th in a series on President Obama’s job creation record
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Friday’s monthly jobs report for July from the BLS celebrated a better than expected creation of +163,000 new jobs. The DOW jumped a whopping +217 points on the good news.

None of the so-called expert pundits wondered enough about the 8.3% “essentially unchanged” unemployment rate to find out why it went up. They were mesmerized by the 163K jobs figure. They accepted it at face value without question. They bought into the early report that the unemployment rate uptick is just a close “rounding error“.

Once again, shabby journalism prevailed and the pundits failed to do their job. If they’d just look beyond the façade of the jobs report they’d see so much more.

The complete July job number totals paint a very different, and far more sobering picture.

Not Reported in the News

Two Charts from the July Jobs Report – Unemployment Rate and Non-Farm Monthly Job Creation

After dropping steadily for nearly a year the unemployment rate bottomed out at 8.1% in April. It has reversed direction and is now creeping back up again.

How can that be if we created 163K new jobs last month and, according to BLS data, the seasonally-adjusted civilian labor force actually decreased by 150,000 in July? That does not compute.

The simple answer is this: There were NOT 163,000 new jobs created in July!

The United States actually LOST 195,000 seasonally-adjusted total jobs in July. In unadjusted numbers total employment isn’t so bad… we only LOST 76,000 REAL jobs last month.

You may be asking why you never heard that on the news. Did the BLS lie? Of course not. They just didn’t report the whole story.  They never do.

It is the tradition of the BLS that they report only total non-farm, seasonally-adjusted employment in the monthly jobs report. That isn’t the total U.S. employment picture. It is a subset over 10 million jobs short of the true total.

The BLS reports non-farm for consistency. It is the only grouping broken down by job categories like construction, manufacturing, total private and government that the BLS discusses in each monthly report.

The Total Employment Jobs Picture

Total U.S. job creation picture… Note big differences from the BLS non-farm job creation chart shown above

The A-1: Labor Force Statistics from the Current Population Survey Report is the report that presents the full employment picture for the United States. It is the report where you find the job losses for July and the drop in the civilian labor force.

Here are other sobering employment facts not heard on CNN or read in the New York Times…

  • Total non-farm seasonally adjusted employment peaked at 138 million in January of 2008. July’s total was 133.2 million. We still have nearly 4.8 million fewer non-farm jobs than before the 2008 recession.
  • Since January of 2008, 10.5 million eligible workers have been added to the U.S. workforce through population growth.
  • The total U.S. seasonally-adjusted workforce (not just non-farm) peaked at 146.6 million in November of 2007. July’s reported total was 142.2 million jobs. By comparison, total  employment is a little better off than total non-farm, but we still have 4.4 million fewer jobs than before the recession.
  • When you factor in population growth the United States is about 10 million or so jobs short of where we should be for a healthy economy!

Conclusions

Friday, the DOW skyrocketed +217 points based on July’s Jobs Report. But when you dig below its façade you see an entirely different view of U.S. total employment.

The BLS reported 22 strait months of continuous non-farm job growth in the July Jobs Report (see the BLS Jobs Report chart above). According to David Axelrod on the Sunday talk shows, the Obama Campaign now claims 29 strait months of continuous job growth.

The full employment picture shows ZERO months of continuous job growth. It shows -195,000 seasonally-adjusted jobs LOST in July and -76,000 real jobs lost!

There are a net 76,000 real people out there wondering why they lost their real jobs last month while supposedly +240,000 others found work to create a net gain of +163,000 jobs for July.

Now you know the facts… the United States had a total net loss of jobs in July, be it seasonally-adjusted or not.

The unemployment rate is calculated based on total employment, not just non-farm employment.

That is why the unemployment rate climbed up to 8.3%.

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About azleader

Learning to see life more clearly... one image at a time!

Posted on Aug 6, 2012, in culture, economics, Job Creation, Jobs, Jobs Reports, Life, news, Opinion, Politics, Thoughts. Bookmark the permalink. 9 Comments.

  1. Our politicians and the media are purposely deceive the punlic. It is shameful. Why isn’t someone like Paul Ryan talking about this?

    • Politicians make careers out of slight-of-hand and deception. Everyone expects them to do that. Everyone expects the BLS to put a positive spin on the jobs numbers for the good of whatever Administration is in charge. The BLS is not a neutral party. It is run by a political appointee under the Department of Labor.

      What disturbs me is the free press should be the watchdogs over government and politicians. But they have stopped doing that… and have taken sides.

      Paul Ryan can and does talk a lot about these things. But the sad truth is that when you have an “R” next to your name you are not gonna be heard much and what does get through will be twisted into something it is not by a largely liberal press.

  2. Your blog and mine have talked about this several times. The US is in a jobs depression. Unfortunately neither party seems to have a solution. I cannot even think of one. The top economists on both sides seem to be alchemists. Do you have a suggested fix? UK style austerity scares me, and stimulus plans with more debt seem ineffective too. Is the best we can do a muddle through for the next 20 years?

    • The reason the world is in the pickle it is, is because of excessive and risky debt growth.

      The Keynesian approach of ignoring debt indefinitely and solving all economic crisis by piling on more debt cannot work forever.

      Inevitably, the time will come when nations and individuals must face up to their excessive debt and pay it down to avoid bankruptcy and depression.

      That time is now! Necessary austerity is the solution. It is painful and will result in job loss in the beginning before prosperity returns.

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