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May 4th, 2007

ritaxis: (Default)
Friday, May 4th, 2007 09:00 am
First of all, I want to register something that nobody likes to talk about. Here's the Labor department jobs report for April, according to CNBC.
Here
it is according to the government. There are slight differences in reporting which are interesting. Also, if you follow links from the Labor Department summary you can get more detailed figures, which raise more questions than they answer, naturally.

The sampling methods look okay to me. Also, the definitions of employed and unemployed and in and out of the labor force don't look ideal to me, but not actually lying.

Both reports claim that 88,000 jobs were added in April. I used to think that "jobs added" meant "more people employed," but it doesn't. Not at all. First of all, the official unemployment rate is "essentially unchanged" as it went from 4.4% to 4.5%. I understand that statistically, that .1% means nothing in terms of trends, but I'd like to stop for a moment and note that it does, according to the Labor Department, mean 77,000 additonal unemployed people, more or less, not counting farmworkers or people who have been unemployed long enough that they have stopped looking.

I think the Labor Department errs in including people who aren't actively looking for work due to transportation problems with the people who are ill or have to care for family memebers instead of with the people who are discouraged due to lack of work or discrimination, but that's a minor point.

About a third of the people who are recorded as unemployed have no reason to think they're going to have a job again. Almost as many are people who have been in the labor force, and out of the labor force, and are now counted as "reentrants." I think this is a broad category, probably including people who have gotten out of prison, people who have completed retraining programs, people who have run out of disability payments, people who stopped actively looking for work because there seemed to be no point and now they've started again for some reason, retirees whose pensions wouldn't keep them in the house, and so on.

According to the Labor Department report but not mentioned in the CNBC summary, there were 611,000 more people not in the labor force in April than in March. This is a hard number to evaluate. It includes retirees, people who have given up looking for work, people who have gone to jail or joined the army or gone back to school, people who have become disabled, and so on. There's a tantalizing note that while hourly wages went up very slightly, weekly wages went down, but I can't evaluate it.

Something that disturbed me is that average hourly wages were reported at $17.25. I wonder how many people actually make that much. When a "living wage" of $11.00/hour was proposed for Santa Cruz, which is reliably reported among the top five least affordable places to live in the country, you could hear the outrage all over the county:" you can't expect us to pay people that much! Nobody can expect to make that much!" So if $11.00 an hour is an unthinkable floor for wages, how can the average be $17.00/hour? Somebody somewhere must be making a hell of a lot more than that -- somebody I don't, locally, know (I know a lot of people making a little more than that, but they've been working for thirty years, and the entry level is way lower). Or does the $17 figure include benefits?

This is the trouble with "averages," isn't it? You could have a lot of people making about the same amount of money or a lot of people making a lot less and a few people making a lot more and still have the same average.


The kicker in the CNBC report is the last line:
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