By: Jeffrey Klein
Political Buzz Examiner
The just released “Weekly Jobless Claims Report,” indicated that 386,000 new claims were made for unemployment insurance for the week ending April 14th, according to an Associated Press article today.
However, even though the title of the article read … “weekly claims declined slightly,” which is, for all practical purposes, misleading.
The actual language in the official press release from the Department of Labor this morning at 8:35 am ET reads:
“In the week ending April 14, the advance figure for seasonally adjusted initial claims was 386,000, a decrease of 2,000 from the previous week’s revised figure of 388,000. The 4-week moving average was 374,750, an increase of 5,500 from the previous week’s revised average of 369,250.”
The prior week “advance” figure was 380,000, which when compared to the 386,000 “advance” figure for this week–results in an increase of 6,000 new claims, not a 2,000 decrease.
It may not seem like much of a difference to some, but to a statistician the title is a gross misstatement, as given each base number, the proper view inverts the trend and scale from a decline (good) of -0.52%, to an actual increase (bad) of +1.58%.
That is a 304% negative variance.
This “re-statement” comports with the trend and scale of the 4-week [less volatile] moving average, which had been in a decline, but has since reversed upward. This week it was up another 5,500, or +1.49%, from 369,250 last week.
The fact that the advance number last week was revised upward by 8,000 this week, to the 388,000 figure, also comports with the inclining trend well into the 4-week moving average.
Author’s note: Although I vehemently disagree with the portrayal of the data and trend in the wording of the title of the Associated Press article–I commend AP for including the actual amount and specification of upward direction of the week-on-week revision.
To put these statistics into stark context, each new weekly jobless claim translates into the “loss” of a job–whereby the accumulation of the last two weeks of new jobless claims, revised, indicates the loss of 774,000 jobs more than negates the 720,000 jobs created over the past three months.
With “Jobs” being the primary issue in the November 2012 elections, according the consistency of every poll conducted over the past three years–these numbers are pivotal in political value.
The Department of Labor is charged with the collection, analysis and reporting of all these numbers, and it is lead by one of President Obama’s political appointees, Ms. Hilda Solis. Her academic background is political science and public administration; however, she does not have a single moment of private sector or non-government job creation experience. Since 1992 she has been a politician; and from 1998 a Washington, D.C. politician.
As these numbers are so critical, due diligence demands that everything about the accuracy and legitimacy of Labor Department numbers, particularly the unemployment rate, labor participation rate, and monthly job creation figures, must be analyzed under a microscope.
This is particularly true of President Obama’s next, new jobs program announced today, called the “Bridge to Work,” which will be operated through the Labor Department, according to a FOXNews article today.
Its’ objective is noble, as well as politically expedient for the president’s reelection prospects
… ‘to curb nagging unemployment, by allowing Americans to keep their benefits while trying out a job.
Supporters of the programs say it helps workers retain or learn new skills, and passed with support from leading Republicans, including House Speaker John Boehner and House Majority Leader Eric Cantor.
It also is designed to answer critics of unemployment benefits, who say the aid discourages some people from aggressively seeking work.
Everyone is behind rapid private sector job growth in America, and this could well be a solid transition method, although it has met with “mixed results” in states that already have such a program.
But, in the spirit of accuracy and “fairness,” there must be a definitional stipulation for labor accounting purposes, i.e. workers involved in this program shall not be considered “employed” for unemployment reporting purposes, until such time as the worker has not received any benefits for a period of not less than three months.
This is the only way to prevent a short-term, taxpayer-funded, “artificial” decrease in the unemployment rate, while leading up to the November 2012 election.