Statistical Illusions

We’ve all read or heard about the jump in employment in February. However, that good news comes with a lot of caveats and questions.

Not to get bogged down in numbers, but here are the stats from NPR.org:

The Labor Department says the February jobless rate fell a tenth of a percent to 8.9 percent. The AP says that’s the lowest rate in nearly two years. Employers also hired at their fastest pace in a year.

The New York Times points out the separate jobs creation report reveals a huge jump in hiring: 192,000 jobs were created in February, compared to January, when 63,000 new jobs opened up. The higher growth in (February) payroll employment was partly the result of a bounce back from unusually depressed hiring in January, when snowstorms shuttered offices and factories around the country.

In another article, NPR points out that the numbers might be incorrect:

The unemployment rate is based on the Labor Department’s monthly Current Population Survey, which is a questionnaire sent to about 60,000 households. That translates into about 110,000 individuals, and is a far bigger survey than any conventional public opinion poll.

But it still has a substantial margin of error—higher than the government’s survey of employers, which is the source for statistics about jobs gained or lost every month.

Maybe it’s my outta-work-for-more-than-a-year cynicism, but I’m not buying this supposed “good” news.

Yes, there are a few bright spots: manufacturers added 33,000 jobs in February. America is always at its best when it makes things. Temporary hiring is also up, which is a precursor to permanent jobs. We hope.

So, what does this indicate for the economy as a whole? Will more industries start hiring? In my profession, does this mean publishers and media companies will see a spike in ad sales and hire more staffers? I don’t think so.

Companies have probably cut as much at they could cut in terms of staffing. But I doubt that means they are going on a hiring spree.

I’m not sure one month of good employment news means much. And is a near 9 percent unemployment rate anything to cheer about?

Will this give HR people even more reason not to hire us? They could think, “Well, job creation is up and these people still can’t get hired? Something must be wrong with them.”

Will the always-fickle media now forget the plight of the long-term unemployed with hiring supposedly on the upswing?

What happens if gas goes to up to $4 a gallon or more? Will that push this fragile recovery back into recession?

And what will happen to the unemployment rate when those thousands of state workers and teachers around the country get laid off?

Even if someone does find a job, it’s very likely he or she was hired at a lower salary. How does that help the economy?

I’m sure there are many persons who have been jobless for so long that they have given up hope of ever finding employment, which may be artificially lowering the unemployment rate.

Many economists have said it will take years to recoup the job losses piled up in this recession. We need more than one month of “good” job numbers.

For the millions of us who are unemployed, until we are actually hired for a job, these numbers are meaningless. Just a lot of statistical illusions.