10/16/2009

Oh Snap!

You know the jobless numbers we get every month? The one that last month showed unemployment at 9.8% (the highest since 1982)? The one that shows over four million Americans had lost their jobs since the recession began? Turns out they're wrong...probably way wrong...and not for the better. Check this out (from Seeking Alpha, via Instapundit) regarding the adjustments the Bureau of Labor Statistics makes each month to the numbers to account for small businesses starting and failing:

For the six months since March 31st the birth/death adjustment has added 815,000 jobs, an average of 135,000 per month. Since small and medium sized firms are suffering from severe credit restrictions, they are much more likely to have reduced employment significantly rather to have added that many jobs. That means current monthly job losses may be running as much as 135,000 higher than is currently being reported. While we won’t know the true number for another year, those being laid off will know, and they will be reducing their spending accordingly. The Fed certainly knows what’s happening and that’s one reason they are promising near-zero interest rates indefinitely. (emphasis added)

The next time you hear some talking head proclaiming the recession is over and recovery is "just around the corner" remember that he (or she) is probably using these overly optimistic numbers the government is giving out. Things are going to get worse before they get better.

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