Lies, Damned lies, and Statistics–Update!
Good news! Since I wrote about this subject last week, the November numbers have been released by the government, and they indicate we only lost 11,000 jobs in November, while the unemployment rate dropped from 10.2% to 10.0%. I also read that the folks in Congress and the Administration loudly cheered the good news all around.
WAIT JUST A MINUTE—if we increased the number of unemployed by 11,000, how could the unemployment rate go DOWN?
Very simple—statistical manipulation. The unemployment rate fell because of the way the government conducts surveys of households to determine who was looking for work during the 4 weeks prior to the survey. From their surveys, it was determined that the “labor force” fell by 100,000 jobs for the third straight month, and the “participation rate” (the portion of the population that is employed, or looking for work) fell to the lowest level since the recession began.
Consequently, we did not bring the unemployment rate down by having fewer people unemployed…we did it by having fewer people looking for work during the survey’s prior 4-week period. In other words, When fewer people look for work, that is fewer people counted as unemployed…so naturally the unemployment rate would drop.
This is one of the problems with using statistics instead of real numbers to present absolute conclusions. Statisticians try to make us think whatever they want us to think—it’s called: “Spin.” You get the picture.
All things considered, I will stand by the numbers I presented in my last post, and say that I believe the real rate of unemployment is very close to 30% when including the “involuntary part-time” unemployed.
Yup—lies, damned lies, and statistics.
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