Are the Unemployment Numbers for Real?
The Department of Labor announced that 138,000 jobs were created in the month of May. What they didn’t tell you was that 255,000 jobs were based on estimates. The DOL has a second number that goes beyond the employment survey. It is called the Birth/Death ratio.
The DOL estimates the number of businesses that were “born” and the number of businesses that “died.” If a business died, it would be assumed that employees lost their jobs. If a business was born, it would be assumed that employees were added. This number could be one of the biggest scams when it comes to economic indicators. You never want to see the word estimates including with the words government accounting.
If you subtracted out the “estimated” (made up) job numbers for this month we would have lost 117,000 jobs. The government has the freedom to massage those uncomfortable numbers a bit.
How about number of jobs gained since President Trump took office? The government claims that between January and May, 594 jobs were created. That is pretty impressive considering that 641 jobs came from “estimates” courtesy of the birth/death ratio. Could we actually have a negative job creation?
Do you believe that we have an unemployment rate of 4.3%? Shadowstats.com exposes the flaws in government accounting. It scrubs the numbers and gives a more accurate picture of the economy. The government claims the unemployment rate is 4.3%. Shadowstats shows an unemployment rate of 20% plus.
Economically, we have very enigmatic growth. Obviously the unemployment situation in America is not as good as marketed. Yet the markets attain new highs almost daily. I don’t want to see what happens when the market wakes up to reality.
The problem is that we have had 8 years of low economic growth. President Obama is the only President in US history to not exceed 3% in economic growth in any 12 month period. At some point that starts to matter. Although that is not what you would want your legacy to be, to be fair he did inherit a post financial crisis economy.
President Trump might have an almost impossible task in front of him. Of course the media and the politicians will assign the blame accordingly. He can create the illusion through government accounting for only so long.