Here's is the core information the Associated Press's Jeannine Aversa had to work with today in the Employment Situation Report released by the government's Bureau of Labor Statistics (BLS):
The "Dec.-Feb. change" column was added by me, but is easily calculated from the data in the BLS report. What Aversa did with this info, and my comments, are after the jump. (see also Noel Sheppard's post here)
Here's how her report began (scare words in bold; the headline is also from AP):
Employers Slash Jobs by Most in 5 Years
Employers slashed jobs by 63,000 in February, the most in five years, the starkest sign yet the country is heading dangerously toward recession or is in one already.
The Labor Department's report, released Friday, also showed that the nation's unemployment rate dipped to 4.8 percent as hundreds of thousands of people — perhaps discouraged by their prospects — left the civilian labor force. The jobless rate was 4.9 percent in January.
Job losses were widespread, with hefty cuts coming from construction, manufacturing, retailing, financial services and a variety of professional and business services. Those losses swamped gains elsewhere including education and health care, leisure and hospitality, and the government.
The latest snapshot of the nation's employment climate underscored the heavy toll of the housing and credit crises on companies, jobseekers and the overall economy.
Here are just a few quick hits on what Aversa missed, or distorted:
- First, how does she know that "employer slashes" and "cuts," as opposed to retirements, voluntary departures, and other forms of attrition, are the sole cause of the job losses? Answer: She doesn't, but the imagery of employers doing violence to workers, a staple of AP reporting in this area, is apparently irresistible.
- Aversa's minimization of the unemployment rate drop by attributing it to people leaving the workforce only works if you look at January. But, as seen in the core info above, the number of adults not in the labor force has gone up very little (+146,000).
- Her "perhaps discouraged workers" theory is an easy one to puncture. In fact, it's debunked in the text of the BLS report, which says that "Among the marginally attached, there were 396,000 discouraged workers in February, about the same as a year earlier." I looked it up — February 2007’s discouraged worker count was 375,000. (Update: NB's Noel Sheppard also noted that January 2008's "discouraged worker" number was a lot higher [467,000] than February's.)
- She totally ignored the fact that the number of unemployed (i.e., the people we should be concerned about) dropped by almost 200,000 in February, and is now 284,000 (3.6%) lower than it was in December. That doesn't exactly square with an economy Aversa says is "heading dangerously toward recession or is in one already."
Here's the real homework assignment someone in the business press should be exploring: How did the total adult population drop from December (233.16 million, the sum of "Civilian labor force" and "Not in labor force") to February (232.81 million)? Where did these people go? Did a lot of them perhaps cross a certain national border to the south, in part because of laws passed in Oklahoma and Arizona?
Other perspectives on today's Employment Situation Report are at this BizzyBlog.com post.