“The Labor Department revised past data to show that the economy comprised 1.36 million fewer jobs in December than previously thought. The revisions showed the economy lost 150,000 jobs in December — far more than the 85,000 initially reported.
The report also featured a new way in which the government estimates the population, which is used to calculate the unemployment rate. That prompted some economists to dismiss the drop in joblessness as a statistical quirk.
“The message is, you can’t believe what they tell you,” said Joshua Shapiro, chief United States economist at MFR Inc. in New York. “Everyone goes crazy over today’s number, but history has been rewritten. Things are not comparable from month to month.”
Did you react to the positive jobs trend initially announced in September - October 2009? Oops, it was really a greater loss than expected, and not a gain at all. One can only suspect that in a few years this whole recovery could be revised away without so much as a bureaucratic blush.
Regarding that 'surprise drop' in unemployment to 9.7%, this is the result of people falling off the unemployment benefits radar, and becoming discouraged. It is essentially meaningless, if not downright misleading.
One may as well solve an unemployment problem by shipping people to Australia. Well, that does have some historical precedent. Hard to tell who has gotten the better deal on that one, at least over the long run.
A better measure of unemployment is the Labor Force Participation Rate, which provides information about the total number of people employed as a percent of the population, without benefit of official banishment.
That number continued to drop again in January, from 64.9% to 64.6%.