09 Oct 2017

Baffled by CNBC

Economics 5 Comments

I’m not kidding, I have no idea what is going on in this CNBC story on the recent jobs report. Here are some excerpts:

Hurricanes Harvey and Irma damaged not only Texas and Florida but also the U.S. jobs picture, as payrolls fell by 33,000 in September. That drop came even as the unemployment rate fell to a 16-year low of 4.2 percent, the Bureau of Labor Statistics reported Friday.

Economists surveyed by Reuters expected payroll growth of 90,000 in September, compared with 169,000 in August. The unemployment rate was expected to hold steady at 4.4 percent. It declined even as the labor-force participation rate rose to 63.1 percent, its highest level all year and the best reading since March 2014.

So, how are all of those facts possible? Did millions of elderly people die in the month?

And then there’s this, later in the article: “Revisions will bear watching in coming months, as the final payrolls number comes from the Labor Department’s byzantine estimation methods. The department’s household survey showed the actual level of employed Americans grew by 906,000 while the unemployment rolls fell by 331,000. The report indicated a record 154.3 million Americans at work.”

I realize they are looking at different sampling techniques, but… Is it really correct that one method says payrolls fell by 33,000, while another says the level increased by 906,000? I think possibly the later quotation is referring to year-to-date numbers?

It shouldn’t be this hard to figure out what the actual statistics (as bogus as they may be) indicate. This is a horribly written article.

5 Responses to “Baffled by CNBC”

  1. Tel says:

    The Labor Force Participation took a small uptick, which is partly seasonal and partly a gradual upward trend since 2015.


    Peter Schiff was pointing out that it’s weird to have more people participating in the economy, and lower unemployment and also fewer jobs. One possible explanation that people with two or three part time jobs ended up going to full time in one of those jobs, and someone else stepped in to cover the remaining part time shifts. There’s a lot of estimation and after-the-fact revision goes on with these numbers.

    • Tel says:

      If you check this guy, the number of part time workers has been fairly flat since 2010 or there abouts.


      Not sure how they measure that, if Uber drivers and similar “gig economy” type people are counted.

      Come to think of it, does Uber even count on the payroll statistics? Could be the measurement is just plain wrong.

  2. Ryan Murphy says:

    Bob, you need to start following along on job market twitter. The second, big number is from a source with a lot of noise. They are expecting revisions to these numbers in the coming months, and that overall the news was roughly neutral, especially given the weather.

    • Bob Murphy says:

      Ryan, but it’s just referring to a one-month period? I.e. one source says -33,000 and the other says +906,000?

      • Ryan Murphy says:

        Yes. This reporting is correct. The stats are wrong, but everyone understands that. Regress to the mean accordingly.

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