Riddle me this: When does 524,000 = 678,000 = 748,000?
Riddle me this Batman: When does 524,000 = 678,000 = 748,000? Give up? Apparently when you're the Bureau of Labor Statistics, the government agency that brought us the seemingly in-line estimate of job losses in December.
I blogged on Friday about how when one adds this additional 154,000 job cuts that the BLS "found" for October and November to the December number, were talking about a total of 678,000 jobs lost (see post: December Jobs Report: Mr. Market shrugs it off, but it is much worse than the headline number indicates). Well, now I found out this weekend that the BLS is up to its old tricks with the BS birth / death model again.
In short, the BLS uses the Birth / Death adjustment to "adjust" the actual job numbers to account for jobs that were created by companies which are either too new or too small to be found by its surveys. Now I don't know about you, but I personally find it exceedingly hard to believe that more businesses are being created than destroyed in this sort of economy, but that's not what the BLS thinks. It added an imaginary 70,000 phony jobs to its reported December number using the Birth / Death adjustment.
So here's the final tally for the month: 524,000 job losses reported + 154,000 additional losses in the prior two months + 70,000 for the Birth / Death adjustment = 748,000 job losses in December. The economy is in rough shape my friends. Let's just hope that the job losses are front-loaded into the end of '08 / beginning of '09 and that the economy will stabilize (at possibly as high 10% unemployment) in the second half of the year.