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Most of Those New Jobs Reported by Bush Are Imaginary

 
 
Reply Sat 12 Jun, 2004 10:02 am
Thursday, June 10, 2004
Most of Those New Jobs Reported Are Imaginary

John Crudele's jobs commentary in the New York Post caght my eye last month. He reported that a huge number of the new jobs being reported by the Bureau of Labor Statistics were actually the imaginary invention of a statistical method known as "birth/death modeling". This model attempts to correct the notion that the employment figures don't account for jobs created by new businesses that haven't reported in to state Unemployment Insurance agencies yet. So long term studies showed that the rate of dying business was very similar to the rate of new businesses formed - on average, over the business cycle. So, the birth/death model imputes a number for new businesses based upon the number of old businesses that died that month. (If population rates were calculated this way, we would 'discover ' that, among other things, fatal traffic accidents cause babies.)

Intrigued, I looked closer. To their credit, the BLS publishes their entire methodology online. All you have to do is wade through explanations of statistical number crunching as described by Washington bureaucrats. What I found suggests that Crudele may have been understating the problem. When you actually reproduce the BLS methodology described in the BLS Handbook of Methods (Chapter 2), you arrive at the conclusion that fully 88% of the new jobs claimed to have been created since March 2003 are imaginary.

For the full story:
http://rtorgerson.blogspot.com/
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Type: Discussion • Score: 1 • Views: 1,896 • Replies: 19
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mysteryman
 
  1  
Reply Sat 12 Jun, 2004 10:06 am
After reading the article,I am forced to question the numbers reported by the Clinton administration.
That is NOT a slam at Clinton,but if they used the same system,that would make their claims suspect also,wouldnt it?
0 Replies
 
mysteryman
 
  1  
Reply Sat 12 Jun, 2004 12:27 pm
Damn,I didnt mean to kill that discussion.I guess people dont like the question I asked.
0 Replies
 
blatham
 
  1  
Reply Sat 12 Jun, 2004 12:41 pm
No, I doubt you asked a wrong question mysteryman. Certainly not for me. But there just simply no chance in hell I'm going to go wading in statistical methodologies. I'll leave that for others.
0 Replies
 
edgarblythe
 
  1  
Reply Sat 12 Jun, 2004 12:53 pm
I don't have the time or desire to wade through all that. The people out of work know who they are. Hopefully, many of them are voters.
0 Replies
 
doglover
 
  1  
Reply Sat 12 Jun, 2004 01:05 pm
The government only sees as person as unemployed for six months regardless of whether or not that person finds another job or not.
That greatly affects statistics.

I would like to know how many of those 'new' jobs are seasonal, part time, or fast food. How many offer health insurance, how many offer a real living wage, how many are part time, how many are technical, how many are temporary.
0 Replies
 
mysteryman
 
  1  
Reply Sat 12 Jun, 2004 07:28 pm
doglover wrote:
The government only sees as person as unemployed for six months regardless of whether or not that person finds another job or not.
That greatly affects statistics.

I would like to know how many of those 'new' jobs are seasonal, part time, or fast food. How many offer health insurance, how many offer a real living wage, how many are part time, how many are technical, how many are temporary.


I hate to bring this up,but since when is it the responsibility of the employer to offer health benefits?
Granted,it is the smart thing to do,but why are you assuming an employer has to?
Its not their job to offer health care,day care,or anything else.
When you accept a job,you should realize that you will get a days pay for a days work.That is all the employer is obligated to give you(other then what the feds mandate).

Also,define "living wage"
Does that mean the money you need to survive,or live comfortably,or be rich?
I am buying a 5 bedroom house in Ky for $72,000.
That wont get a studio apt in NYC.So,what should I get paid? The average here in KY,or the average in NYC? Also,if you live in NYC,then why do you care what I get paid here?
0 Replies
 
Joe Nation
 
  1  
Reply Sat 12 Jun, 2004 07:43 pm
Quote:
I hate to bring this up,but since when is it the responsibility of the employer to offer health benefits?
Granted,it is the smart thing to do,but why are you assuming an employer has to?
Its not their job to offer health care,day care,or anything else.
When you accept a job,you should realize that you will get a days pay for a days work.That is all the employer is obligated to give you(other then what the feds mandate).


Okay then, smartboy, try to hire the most productive workers by offering them nothing but wages. What year do you think it is ? Workers,-by the way- not a derogatory term, are a bit better educated than in 1950. They know about health care, child care and disability insurance. They'd like to know when they will be fully vested in a 401K and if you think you are going to produce by hiring the ones who don't ask about such things, you need not be in business.
Welcome to 2004.
Joe
0 Replies
 
mysteryman
 
  1  
Reply Sat 12 Jun, 2004 08:27 pm
Joe Nation wrote:
Quote:
I hate to bring this up,but since when is it the responsibility of the employer to offer health benefits?
Granted,it is the smart thing to do,but why are you assuming an employer has to?
Its not their job to offer health care,day care,or anything else.
When you accept a job,you should realize that you will get a days pay for a days work.That is all the employer is obligated to give you(other then what the feds mandate).


Okay then, smartboy, try to hire the most productive workers by offering them nothing but wages. What year do you think it is ? Workers,-by the way- not a derogatory term, are a bit better educated than in 1950. They know about health care, child care and disability insurance. They'd like to know when they will be fully vested in a 401K and if you think you are going to produce by hiring the ones who don't ask about such things, you need not be in business.
Welcome to 2004.
Joe


I guess you missed the line where I said "Granted,it is the smart thing to do,but why are you assuming an employer has to? "
A decent employer will offer benefits,but he is NOT obligated to.If he wants to get good employees he will,but no employer has to offer benefits.
You missed that line,I guess.
0 Replies
 
doglover
 
  1  
Reply Sat 12 Jun, 2004 08:42 pm
mysteryman wrote:
I hate to bring this up,but since when is it the responsibility of the employer to offer health benefits?
Granted,it is the smart thing to do,but why are you assuming an employer has to?


What's there to hate to bring up mysteryman? When someone becomes an employer, they reap the benefits of the labor their workforce provides. The employer doesn't 'have to' but it is in the best interest of the employer that his employees and their families receive proper medical care. We are talking about people here...not farm animals. An employer should provide health benefits because it's the right thing to do. Unfortunately, many employers are not 'decent', therefore, I think the government should make it mandatory they provide employees with health care.


Quote:
Its not their job to offer health care,day care,or anything else.
When you accept a job,you should realize that you will get a days pay for a days work.That is all the employer is obligated to give you(other then what the feds mandate).


Thank goodness there are mandates employers must follow...hence we would be back in the days of 12 year olds working 18 hour days in sweat shops for a mere penance.

Quote:
Also,define "living wage"
Does that mean the money you need to survive,or live comfortably,or be rich?
I am buying a 5 bedroom house in Ky for $72,000.
That wont get a studio apt in NYC.So,what should I get paid? The average here in KY,or the average in NYC? Also,if you live in NYC,then why do you care what I get paid here?


A living wage is subjective. Too many factors such as locale, size of family, etc make it impossible to define 'living wage'. I do think the minimum wage should be higher than it currently is. How is anyone supposed to support themselves (pay rent, food, clothing, transportation) on $6.00 an hour, no matter what part of the country they live in.

The point I believe you are missing mysterman, is the fact that not everyone is capable of landing a good paying high tech job for various reasons ranging from lack of education to having a limited IQ.
0 Replies
 
edgarblythe
 
  1  
Reply Sat 12 Jun, 2004 10:30 pm
My daughter is seeking a new job while she goes to nursing classes. It's surprising how few people out there are offering insurance. We seem to be regressing in that area. I would not even consider a job with no insurance, unless I was so desperate I had to. The insurance I have is a plan that makes it hard to find a doctor willing to be in the system. I live in Tomball, but the nearest doctors are in Spring and The Woodlands.
0 Replies
 
au1929
 
  1  
Reply Sun 13 Jun, 2004 09:27 am
I as a Quality assurance engineer and Quality assurance Mgr. used statistics on a daily basis. Even with my limited knowledge of statistics I could manipulate numbers to get the desired results. Numbers do not lie statisticians do.

As to who should provide health insurance. Should we depend on the largesse of the employer or better still can we depend on the largesse of the employer? IMO the answer is a resounding no. The only sure way to afford this service is through a universally mandated system. There is no reason why we as the richest and most powerful nation in the world cannot design a system to do what every other industrial nation in the world does. Provide medical care for all it's citizens.
0 Replies
 
au1929
 
  1  
Reply Sun 13 Jun, 2004 09:28 am
VOID DUPLICATE POST
0 Replies
 
GeneralTsao
 
  1  
Reply Sun 13 Jun, 2004 09:35 am
This is way too big a topic to fully explain outside of a classroom combined with real-life businessowner experience, but here's a small taste.

Quote:
An employer should provide health benefits because it's the right thing to do. Unfortunately, many employers are not 'decent', therefore, I think the government should make it mandatory they provide employees with health care.


I think the point which has been missed here is that employment is competitive. Just like Wal-Mart competes for customers with Target, these companies also compete FOR EMPLOYEES.

Government mandates kill competition and cause price increases and wage decreases.

People are often too short-sighted. They want mandated health care provided by the businessowners (because we business owners are evil, selfish, slavedriving, wealthy people?) but at the same time they gripe about prices being too high.

They chant, "BUY AMERICAN! SUPPORT AMERICAN JOBS! BUY AMERICAN!" but then they shop at Wal-Mart because of convenience and (allegedly) low prices. Most of Wal-Mart's product comes from China and other foreign nations.

It was said earlier in this thread that the counting of new jobs was inaccurate because of blah, blah, something about the Unemployment insurance office. I, as a business owner, have never registered with the unemployment insurance office. In fact, by being a proprietorship, I am not protected by unemployment insurance. A proprietor has agreed to carry this risk him/herself.

Being self-employed also means that no one pays for my health insurance but myself. Why should I be required to buy health insurance for my employees?

Why shouldn't the employees be required to manage their money and pay their own insurance?

Larger companies, of their own accord by the way, decided to offer health insurance as an employment incentive. It was just one of many ways to compete in the employment market. Obviously, it worked.

It worked so well, in fact, that now, some 30 years later, people are claiming their employers should be REQUIRED to provide this benefit.

Over the years, employers have found many unique (and generous) ways to compete for employees. There are day care centers, dental plans, weight/exercise rooms, Health Club memberships, company car, paid vacations, company-paid education, company-paid seminars (usually in vacation spots), etc.

All these things provided without government mandate.

Finally, just how high should the minimum wage be?

I think if the minimum wage were $40 per hour, there would still be poor people, because they wouldn't manage their money.

The minimum wage is just that--a MINIMUM. It's entry-level pay. It is true that you cannot raise a family on minimum wage. Everyone knows that. So improve yourself! Make yourself WORTH MORE.

If you are worth more, your employer will pay you more, or you will find another employer who will pay you what you demand (again, this is employment competition).

Yes, there are those relatively few persons who cannot, due to disability, improve themselves. This country is one of the most generous in the world. We have entire industries built on helping these people who cannot help themselves.

We have many charities which give goods, food, housing, and money to those in need.

And those charities receive funding from people buying their goods or from their thrift stores, from personal donations, but largely from companies which give to charities very generously.

That's all for now.

General Tsao
"Unemployed" since 1991
0 Replies
 
rabel22
 
  1  
Reply Sun 13 Jun, 2004 10:09 pm
General Tsao
I thought it interesting that you used Wal-Mart as one of your examples of compeating business. Walmart usually puts stores in smaller cities where there isent any competation. That way what ever wages are paid are determined by Walmart. Walmart dosent have any 40 hr workers so that they dont have full time workers. No insurance at Walmart unless the low paid worker pays for it. Insurance is a sore point with me because I worked for 42 years at a steel mill for evential retirement and insurance. When I retired I got them untill my company went broke and guess what happened to the insurance I was "guaranteed". Try getting insurance at my age. If not for Soc. Sec. I couldent get it no matter what because im not perfectly healthy. If I were healthy I could get it at about $800 a month. Im one of those commies who think we need a national insurance plan for every citizen in the US. I notice that for 13 years you worked for yourself. I hope there isent a Walmart in competition with you because if there is I dont think youll be in business much longer.
0 Replies
 
GeneralTsao
 
  1  
Reply Sun 13 Jun, 2004 11:10 pm
rabel22 wrote:
General Tsao
I thought it interesting that you used Wal-Mart as one of your examples of compeating business. Walmart usually puts stores in smaller cities where there isent any competation. That way what ever wages are paid are determined by Walmart. Walmart dosent have any 40 hr workers so that they dont have full time workers. No insurance at Walmart unless the low paid worker pays for it. Insurance is a sore point with me because I worked for 42 years at a steel mill for evential retirement and insurance. When I retired I got them untill my company went broke and guess what happened to the insurance I was "guaranteed". Try getting insurance at my age. If not for Soc. Sec. I couldent get it no matter what because im not perfectly healthy. If I were healthy I could get it at about $800 a month. Im one of those commies who think we need a national insurance plan for every citizen in the US. I notice that for 13 years you worked for yourself. I hope there isent a Walmart in competition with you because if there is I dont think youll be in business much longer.


Thanks for your comments, rabel. I agree with you that Wal-Mart builds in small towns with no competition--now.

They ran out of cities to build in probably 15 years ago. Small towns were the next obvious marketplace. McDonald's has tried the same thing for the last 15 years. Golden Arch Cafe was a test-market store in a town of a few thousand people. Basically, it was a "meat and two" kind of place, designed to appeal to the small-town folk. It failed quickly. Long story. Ask if you want to hear it.

Anyway, Wal-Mart has historically gone head-to-head with Ben Franklin Stores, Kmart, Target, and similar discount stores. Capitalizing on the small towns was just the next logical step. If a business does not continue to grow, its stock loses value. So a business must grow. Walmart has every major city in the US except Manhattan, as far as I know.

Whenever a Wal-mart tries to enter a small town, all the local merchants freak out, because they fear they will go out of business at the hands of the monster.

Same thing happens when a Home Depot comes to town--the hardware and lumber stores freak out.

But in most cases, these small businesses continue to thrive if they focus on providing what the big box stores cannot.

I am facing the same sort of problems in my business. I run a little one-man carpet cleaning business which serves the Metro Nashville area. I have to compete with Stanley Steemer, Coit, Steamatic, Serv-Pro (whose National HQ is 15 minutes from my house), Chem-Dry, DryCon, ServiceMaster, Fiber Seal, and perhaps some other franchises I've forgotten to mention. Oh, btw, Home Depot has opened a carpet cleaning division, as have several carpet retailers and Shaw Industries (the largest carpet manufacturer in the country).

Many of the franchise firms have more than one operation in town. So I actually have MORE "big box" competitors than one Wal-mart or Home Depot.

How can I possibly compete with these big names, plus over 120 other private carpet cleaning companies (not including the janitorial and maid service companies which also clean carpets)? I cannot compete on price, that's for sure. I do not have the buying power of these giants, so my detergents, components, equipment, etc. cost more than the big guys.

My answer is to compete where they can't or won't. I offer the highest quality in town. I take industry-related classes and seminars, and I have the two highest certifications attainable by a cleaning technician. To date, no one else in my area has both Certified Master Cleaner and Cert. Master Restorer.

I wear a shirt and tie to each and every job, and I take the time to chat with the client, the client's kids, or their dog. The big box guys just want money. I want a relationship.

Oh, I also have a stronger guarantee than anyone else in the area.

So, I'm not worried about the big guys. And I do not particularly like Wal-mart, so I shop there as infrequently as possible.

Regarding insurance--I just have to ask, and I'm not being a smart-aleck, but I have to ask why people think that employers should have to pay for their insurance?

My health insurance costs me $750 a month. Lately, it goes up about 30% every three months (it started out at $75/mo in 1998), so I definately feel your pain on that one!

But where do peoplethink companies get the money to pay for that insurance? It can only come from a few different places, and each of those affects the consumer.

1). Comes out of payroll. If there was not insurance to pay, wages could be higher. So wages are either lowered to compensate, or jobs are cut (or not created) to compensate.
2). Comes out of price increases. If there was not insurance to pay, prices could be cheaper. Price of the product or service is higher to compensate for insurance cost.
3) Comes out of company profit. This is not really likely to happen. Most companies only make 10-20% profit anyway, so there's not a lot of wiggle room in the profit department if a company is going to keep up its other departments such as payroll, charitable giving, equipment maintenance, safety classes, insurance, etc.
4). Lower the quality. Buy cheaper parts to save money. Of course, this means buying goods from China or India, so you can't win there. In the case of a service business, it means shortcutting on the job. In both cases, it leads to lower consumer satisfaction, and a drop in sales.

So the money has got to come from somewhere. Some employers choose to offer insurance. Others (such as my company) cannot afford to offer it while still being able to stay in business (unless I cut wages, because I will not cut quality).

Rabel, it is regrettable that your former employer tanked and left you hanging. I hope the medical, law, and insurance industries find a solution to ridiculous inflation in their industry. The rest of we citizens are paying dearly for their mismanagement, and frivolous lawsuits of a very few greedy individuals.

It is good you mentioned your plight, though. Perhaps someone will read your words and learn that today's world is not reliable. We must plan for the worst. For example, I am planning now to live without the benefit of Social Security...just in case it's not there in 30 years. Sad

General Tsao
0 Replies
 
rabel22
 
  1  
Reply Mon 14 Jun, 2004 10:16 am
My wife and I fight about Wally world all the time. I live in a small town, POP 500, near a larger town, 16 milesfrom me, of 10000 pop which has a Super Walmart. I refuse to buy groceries at the walmart even though my wife would like to shop there. More of a selection she says. The gro. store we shop at has everything one would want in the way of groceries and prices that more than compete with walmart. Walmart has already run businesses like ben franklin and such out of business in this town and the prices have gone up at walmart as the competation goes away. I refuse to help them to run the only grocery store that competes with them out of business. Like you I dont shop at walmart any more than I have to. If one buys electronic things from them you might as well figure on throwing away anything that goes bad because it will cost more to repair it than to buy a new one. China is a long way to ship something for repair. Unfortunately we cant buy American electronics because they dont exist. Id like to blame the government for this but its the fault of the common citizens trying to save a nickle by buying foriegn products. I take part of what I said back, the government is partly at fault for makeing it so easy for manufacturers to move out of the country. When we give tax breakes to industries who move its the fault of our congress and thier stupid laws. The time is going to come when we have no jobs to pay people to buy anything including food. Perhaps people will wake up to what has happened to us but by then it will be too late.
0 Replies
 
rabel22
 
  1  
Reply Mon 14 Jun, 2004 10:19 am
Lordy, I believe that was the most longwinded post I ever posted. Probebly raised the ambient temp. 2 or 3 degrees.
0 Replies
 
edgarblythe
 
  1  
Reply Mon 14 Jun, 2004 11:43 am
It's obvious the poor worker is being crowded out of benefits. Since employers can't or won't, more and more, it is up to the govt.
0 Replies
 
au1929
 
  1  
Reply Mon 14 Jun, 2004 02:16 pm
edgarblythe
In recent years union membership has diminished because companies offered benefits comparable to those received by unionized labor. Should the fringes be cut and labor get squeezed I would expect that people will again look to unions for their protection and bargaining power.
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