More than 100,000 Jobs Lost, Likely Much Worse
The final government unemployment report before the midterm election was released Oct. 8 showing a loss of 95,000 jobs in September, and an additional 15,000 losses in July and August and an unemployment rate still at 9.6 percent.
But Gallup warned on Oct. 7 that the BLS report was “likely to understate” the job losses in September. By its calculations the unemployment rate is actually much higher at 10.1 percent.
Dennis Jacobe, Gallup’s chief economist, found that there was a sharp increase in job losses in the latter half of September that were “unlikely to be picked up in the government’s unemployment report.”
“Gallup's modeling of the unemployment rate is consistent with Tuesday's ADP report of a decline of 39,000 private-sector jobs, and indicates that the government's national unemployment rate in September will be in the 9.6% to 9.8% range,” Jacobe wrote.
Ultimately, Gallup said the rising losses in late September “does not bode well for the economy during the fourth quarter, or for holiday sales.” Jacobe warned policymakers not to be “misled” by the BLS report and that the jobs market could be “deteriorating more rapidly” than the government would suggest.
The cable news immediate reaction to the BLS report on Oct. 8 was downbeat, although CNN’s “American Morning” emphasized the government’s claim of 64,000 private sector jobs added (as they did in early September.) CNN’s Christine Romans did notice the “one thing troubling” in the government report was the “all-time high” number of people working part-time who want to be working full time.
But Roman's “American Morning” report failed to tell its viewers about Gallup’s concern that things might be much worse than the government figures would say.
MSNBC’s “Morning Joe” regular and “progressive” Donnie Deutsch brought up Gallup’s figures in the panel discussion of the jobs numbers. He also told the panel that even the Democrat CEO friends he has are “not bullish” on the economy.
CNBC’s Maria Bartiromo responded to Deutsch saying, “We’re seeing the economy deteriorate, we’re definitely in a soft patch that, um, resumed in the summer time.”
“Maria, do you know one CEO, ‘cuz I don’t, who feels good about what’s coming in the next couple years?” Deutsch asked. “I have yet to find one.”
The BLS report also showed 1.2 million discouraged workers in September, up more than 500,000 from one year earlier. The government’s preliminary estimate of the benchmark revision (annual revision to the jobs data) showed an additional 366,000 job losses in the past year. That revision will be finalized and issued in its Feb. 4, 2011 report.
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