Is the United States Department of Labor Manipulating Its Data? - The AnswerByRaymond D. Matkowsky
“Stupid Is As Stupid Does” – “Forrest Gump” July 6, 1994
“Stupid Is As Stupid Does.” What does it mean? To me it means that you judge someone or something by what is done repeatedly. Last month I asked if the U.S. Labor Department was manipulating its data for political reasons. If you wish to read my comments, you will find the article here. We have obtained several reports over the last four months to judge the department’s motives and the comparisons do not speak well for the department. The Bureau of Labor Statistics (BLS) has been accused several times of bowing to political pressure. The answer lies squarely with what the BLS has done.
Reporting Errors
The BLS has already admitted that reporting errors have occurred that would have resulted in an April unemployment level of 19.5% instead of the reported 14.7%. The same error for May 2020 may have resulted in an unemployment level of around 20% instead of the reported 13.3%. The stated reason for not correcting the errors in a timely fashion was that the Department of Labor did not want to be accused of politicizing the data. Unfortunately for those only reading the headline number, they were misled into thinking that the unemployment situation was far better than it actually was.
In July of this year, the BLS reported that the number of unemployed workers fell by 1.4 million people to 16.3 million. The BLS reported an unemployment level of 10.2%. There were 31.5 million people collecting unemployment insurance at time. Workforce data is now available as of February 2020. The workforce was 164.6 million. This gives an unemployment number of 19.1%.
More People Are Unemployed
Now the BLS is reporting that unemployment has decreased to 8.4%. Initial claims for the week of September 17, 2020 rose by 880,000. Continuing claims fell by slightly less than a million. For the week of September 24, 2020, first time unemployment claims were 870,000. Recipients of all programs remain around 26 million. Unemployment is increasing not decreasing. For the unemployment level to fall to 8.4% from 10.2%, 2.95 million have had to return to work.
Unfortunately, the individual states report that 24.2 million people are not working because their employer is closed or does not have any business because of Covid-19. If 24.2 million people are out of work, the unemployment rate should be about at least 14.7% not 8.4%. 14.7% is very similar to the 14.3% in what the government labels as the U-6 unemployment rate. U-6 embraces all workers, including the discouraged, those that have not looked for work in the last four weeks, and those in the gig economy. If you are on temporary layoff because your employer is closed or does not have enough business, you most likely have not looked for a new job in the last four weeks and would not be counted as unemployed. The BLS has not advertised this number. It appears that government is not including all those that are truly unemployed.
For the U.S. to have an 8.4% unemployment rate, the workforce needs to be 288.1 million people. It has never been that high! People will have to look around and decide if they believe the 8.4% or the 14.7% or something in between.
Suppression Of Data?
On March 18, 2020, the Labor Department sent an email to state officials asking them to embargo claims figures until the BLS issued their own unemployment weekly report according to an article in The New York Times. A spokesman for the Department confirms that this was done and says that this was to insure the information is communicated in a competent and fair manner.
Questionable BLS Behavior?
“Stupid Is As Stupid Does.” What has The Bureau of Labor Statistics done these past few years? They have asked the states to withhold their data. The states’ data does not necessarily agree with federal data. Some of the federal reports do not necessarily complement other federal reports. They have given us knowingly deceptive data for several months in a row and offer a hard to believe excuse. Also the BLS is not including all those unemployed when advertising their numbers. Are they being deceptive and playing politics or are they just plain incompetent?
You must make a personal decision in what you are to believe. Whatever that decision is do not take the headline data at face value. Convince yourself as to its accuracy. Dive deeply into all the reports, federal and state. Do this especially for your jurisdiction. It can be better or worse than the general consensus. If you do not, you will put your business in severe peril.
If you have any further suggestions, do not keep it to yourself. Help your fellow readers!
If you have any questions, comments or suggestions drop me a line at rdm@datastats.com.
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