{"id":44484,"date":"2013-11-22T07:39:02","date_gmt":"2013-11-22T12:39:02","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=44484"},"modified":"2013-11-22T07:39:02","modified_gmt":"2013-11-22T12:39:02","slug":"america-may-fabricating-jobs-numbers","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/11\/22\/america-may-fabricating-jobs-numbers\/","title":{"rendered":"Why America May Be Fabricating Its Jobs Numbers"},"content":{"rendered":"

By George Leong<\/a> for Investment Contrarians<\/a><\/p>\n

\"FabricatingMany accuse China of manipulating its economic data to fit what the market wants to see, yet this kind of behavior doesn\u2019t appear to be isolated to China. It even occurs here\u2014if you believe what the New York Post<\/i> reported in a recent editorial. If it were true, to be honest, I wouldn\u2019t be that surprised.<\/p>\n

According to the article, there are allegations that the Census Bureau fabricated jobs market<\/a> data reflected in the non-farm payrolls reading in 2010 and that this continues to occur. (CNBC, \u201cFaked data may have boosted 2012 job reports: NY Post,\u201d CNBC web site, November 19, 2013.)<\/p>\n

But whether there may or may not be manipulated data within the monthly jobs market reading, I\u2019m not here to determine that. All I can say on the matter is that how the jobs market data is reported and what is reported has always been suspect to me.<\/p>\n

The government tells us there are about 11.3 million Americans unemployed in the jobs market, representing an unemployment rate of 7.3% in October. Now think about it; what does the reference \u201cunemployed\u201d really mean? The government seems to let you think it implies the number of individuals looking for work in the jobs market\u2014but that\u2019s not the case.<\/p>\n

There are millions of workers not included in the unemployed numbers because they have dropped out of the workforce or have given up looking for work four weeks prior to the report. The problem is these people should still be considered unemployed regardless of the criteria used by the U.S. Department of Labor. But we all know that the number of unemployed in the jobs market is probably in excess of 20 million workers\u2014and even more if you count those who are underemployed or working part-time because they cannot find full-time work.<\/p>\n

While you may not think it\u2019s an issue, the rise in the unemployed in the jobs market and the widening disparity in income levels between the bottom and top earners is a real problem that will eventually boil over. It\u2019s not good for the country, and it could wreak havoc down the road should the problem continue.<\/p>\n

A major issue is the group of workers classified as \u201clong-term unemployed.\u201d These are generally the workers who have been pounding the pavement and sending out hundreds or even thousands of resumes only to face continued rejection. Just consider the study by the Federal Reserve Bank of San Francisco, which noted that those who have been unemployed for at least six months have a 10% chance of landing a new job each month versus a 20%\u201330% probability for the newly unemployed. (Source: Lowrey, A., \u201cCaught in unemployment\u2019s revolving door,\u201d New York Times<\/i>, November 17, 2013.)<\/p>\n

Folks, there\u2019s a jobs market crisis out there. Don\u2019t fall for the 7.3% unemployment rate reported. The underlying number should be in the double digits, like what we\u2019re seeing in the eurozone. If the jobs market was healthy, we would see stronger corporate revenue growth, but we\u2019re not. This is a red flag that indicates corporations are stalling, which suggests an overblown stock market. Given this, I would suggest investors take some profits off the table and\/or have put options in place. The reality is that if it wasn\u2019t for the Fed\u2019s easy money, the stock market rally would not have been as strong.<\/p>\n

Massaging the reported numbers may make them look better on the surface, but we all know that the jobs market situation is much worse than reported.<\/p>\n

 <\/p>\n

Original: www.investmentcontrarians.com\/recession\/why-america-may-be-fabricating-its-jobs-numbers\/3327\/<\/a><\/p>\n

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 <\/p>\n","protected":false},"excerpt":{"rendered":"

By George Leong for Investment Contrarians Many accuse China of manipulating its economic data to fit what the market wants to see, yet this kind of behavior doesn\u2019t appear to be isolated to China. It even occurs here\u2014if you believe what the New York Post reported in a recent editorial. If it were true, to … <\/p>\n

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