Doug Henwood writes:
Basically the U.S. economy is flat to slightly positive at the macro level, and sort of awful at lower levels. Posted by DeLong at February 08, 2003 06:23 AM | TrackbackFEBRUARY 7, 2003: By the way, today's U.S. employment numbers were deceptively strong. Payrolls rose 143,000, but mainly because of a quirk in seasonal adjustment. Normally, retailers hire just before Xmas and lay off just after; seasonal adjustment is supposed to compensate for this recurring pattern to get a picture of the underlying trend. This year they didn't hire (in fact it was the 4th-weakest Xmas season in retail employment since 1939) - and so this January they didn't lay off as many as usual. The SA effect is large: before adjustment, a million jobs were lost in retail; after, there was a gain of 101,000. Hotheads like John Crudele of the NY Post will call this cooking the books, but it's not. Seasonal adjustment is usually a good thing, though sometimes it can play tricks on you. Similar seasonality affected unemployment: after adjustment it fell from 6.0% to 5.7% - but it rose 0.5 points before adjustment. There are other quirks that make the January unemployment number iffy - you can read about them at ftp://146.142.4.23/pub/news.release/empsit.txt.
Inspired by a comment by David, I found the following in the press release: "Effective with the release of data for January 2003, a number of
changes affect estimates from the Current Population Survey (CPS), or household survey. These changes were undertaken to benchmark the survey data to more current estimates of the U.S. population; to adopt new standards for data on race, ethnicity, industry, and occupation; and to improve seasonal adjustment procedures. In addition, the data reflect updated seasonal adjustment factors and revisions to historical seasonally adjusted data. The following describes these changes in more detail and provides information regarding their impact on the survey estimates. As discussed below, a one-month change in weighting procedures makes data for January not strictly comparable with data for both prior and subsequent months."
Any idea how large a change these modifications caused?
My fear is that the Mayberry Machiavellis will impose on the statisticians the same sort of pressures that have been imposed on other professionals, and that pretty soon a 6% unemployment rate will mean that 15% of the population is looking for work.
Posted by: Charles Utwater II on February 8, 2003 07:50 AMBrad
A while ago you thought that productivity would come in strong for the fourth quarter. Fewer jobs created and increased production should have led to higher productivity. Instead, productivity fell. I am puzzled. Are we not reading the seasonal corrections for the employment data properly?
Posted by: anne on February 8, 2003 02:36 PMhttp://www.nytimes.com/2003/02/06/business/06JOBS.html
"The New York Times reported earlier this week, before the new data became available, that the loss of jobs since the last recession, which began in March 2001, was the worst in almost 20 years. Even with the latest job figures factored in, that remains true."
Posted by: anne on February 8, 2003 02:45 PMMy sense is that analysts are raising and will continue to raise their projections of full employment. Where 4% was possible, we will settle for 6%, and the social cost be damned. As though the economic gains of the 90's were a mirage....
Posted by: anne on February 9, 2003 09:08 AM