The unemployment numbers … digging deeper.

The Feds said last Friday that the economy added over 200,000 jobs and the unemployment rate stayed at 8.3%

I’d predicted 8.5% or higher … hmmm.

First, unemployment claims increased in each of the 4 weeks in February

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That would make you think that the unemployment rate would go up, right?

Not so, using Fed math … the BLS reported that the  seasonally adjusted unemployment rate stayed at 8.3% …

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But, take a peek at the raw unemployment rate … the one before the Feds adjust for seasonality.

Hmmm.  Looks like the rate has ticked up in the past couple of months … and is now around 8.7%

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The secret sauce: the seasonal adjustment factors.

I guess a guy doesn’t feel unemployed if he’s unemployed in February  … seasonal unemployment is different.

Really?

Let’s look at the main data series that goes into the unemployment rate: the number of employed people.

Again, the Feds report steady improvement on a seasonally adjusted basis.

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But,  when the seasonality factors are backed out, actual employment levels have been going down … consistent with the unemployment claims data.

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Finally,  for fun, let’s match the seasonally adjusted unemployment rates data (which is reported by the Feds) against the raw numbers (which the Fed calculate but don’t shout out).

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Pretty interesting … says we’re in a period when seasonally adjusting helps the unemployment rate appear more favorable … but when we head into Aug, Sept, Oct, Nov … seasonally adjusting makes the unemployment rate look less favorable.

My next prediction: about mid-summer, the Feds will come out with some cock-and-bull story explaining why they’re going to start report unemployment data that isn’t seasonally adjusted.

And, they’ll say with a straight face that the change in reporting methods has nothing to do with the election.

Yeah, right.

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