Matt Yglesias

Mysteries of the BLS Seasonal Adjustment Process

Remember on Friday when unemployment rose and 190,000 jobs were lost? Floyd Norris points out that even though these events were widely reported they didn’t actually happen. Instead, according to the Bureau of Labor Statistics the number of jobs went up and the unemployment rate went down. But then a seasonal adjustment factor was applies, and put things into negative territory.

Brad DeLong was inspired to make similar observations in mid-October when the media reported that new unemployment claims had fallen when, in fact, they rose and then were seasonally adjusted into negative territory:

One issue here is that in unusual times the seasonal adjustment process based on the recent past is probably not going to give you the best results. That said, I don’t think dumping the process would help, the labor market really does exhibit a lot of seasonality. But I think responsible journalism should report both numbers fairly prominently. Even if an uptick in economic activity turns out to be purely seasonal, it’s still a real occurrence in the world.

Today’s Pay Gap Factoid

CAP, in partnership with Maria Shriver, has a giant report out called “The Shriver Report: A Woman’s Nation Changes Everything” about the role of women in the modern economy. There’s tons of stuff in there, but I thought I would just pull out this factoid from Heather Boushey’s chapter in the volume.

In broad terms, this is about what you would expect. The change over time has been really large and that’s worth keeping in mind. It’s also interesting that older mothers and mothers with college degrees earn substantially more relative to their husbands than do younger or less-educated mothers. There’s something of a move afoot to try to convince women that they need to reverse the recent trend toward delaying marriage and motherhood, but the statistics seem to indicate that this would be not-so-wise.

Unemployment in Denmark

I got these numbers from the official government of Denmark statistics page but the current unemployment rate seems a bit implausibly low:

At any rate, unless I’m badly misunderstanding what they’re reporting, Denmark seems to be weathering the current global downturn quite well.

Slouching Toward Employment Parity

Catherine Rampell offers this informative chart that I read as demonstrating that for all the talk of a “mancession” and such, we’re primarily looking at long-term shifts in the gender composition of the labor market:

By all accounts I’ve heard, future job growth is predicted to be disproportionately concentrated in the health and education sectors. If so, either the traditional tendency of those sectors to disproportionately employ women or else traditional ideas about gender roles within a family will have to shift.

What a Lagging Indicator Looks Like

The unemployment rate, as you’ve probably heard, is a lagging indicator. But there are lags and then there are lags. One of the most worrying things about the current economic situation is that in recent recession the lag has been loooooong. Take this chart from Brad DeLong about the last recession:

Brad says, “A recovery in which unemployment is higher two years later than when the recovery began is not much of a recovery. And I don’t see what is going to keep the probability of such an eventuality low.”

I think the theoretical issue here is that as time passes, and growth happens, and technology progresses the labor market gets more advanced and more specialized. In general, this is a sign of good things happening. But the more advanced and specialized the economy becomes, the more difficult it is to make structural adjustments quickly. And when pulling out of a big recession, that’s a big problem.

America’s Employer-Friendly Labor Market Conditions Imperil Public Health

The Centers for Disease Control sensibly suggests that in these times of swine flu, if you get sick you should stay home rather than spread the disease to your coworkers:

Influenza is thought to spread mainly person-to-person through coughing or sneezing of infected people. If you get sick, CDC recommends that you stay home from work or school and limit contact with others to keep from infecting them.

Which is nice for those people whose employers provide them with paid sick days. But as Pat Garofalo points out not that many people have employers who provide them with paid sick days:

Currently, nearly 50 percent of private-sector workers have no paid sick days. For low-income workers, the number jumps to 76 percent, and climbs to 86 percent for food service workers. These workers have to decide between the health of themselves and their co-workers, and the wages that they lose by staying home.

In other words, on any given day a large proportion of sick food service workers are going to find themselves unable to afford to take the day off, endangering the health of everyone else. This bill from Ted Kennedy and Rosa DeLauro would “guarantee workers up to seven paid sick days a year to recover from an illness or care for a sick family member.”