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U.S. Jobless Rate Declines To 7.8%; 114,000 Jobs Added

Friday, October 5, 2012 - 8:12 AM
From Bloomberg
The unemployment rate in the U.S. unexpectedly fell to 7.8 percent in September, the lowest since President Barack Obama took office in January 2009, as employers took on more part-time workers.

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Calculated Risk Blog has more details including charts:
Even though payroll growth was weak, this was a much stronger report than the last few months, especially considering the upward revisions to the July and August reports. And that doesn't include the annual benchmark revision (that will also show more jobs).

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Ken TuminKen Tumin5,471 posts since
Nov 29, 2009
Rep Points: 125,634
1. Friday, October 5, 2012 - 10:20 AM
This drop in the unemployment rate is predicated on the claim that 873,000 people found employment, and yet only 114,000 jobs were added. And all while the labor participation rate remains unchanged. Is this some new form of arithmetic? Or does this seem a contradiction? Even if you allow for the explanation that perhaps the gap might be explained by part-time employment, it looks like an unbelievably high spike for a single month. The timing of this is also reason to be skeptical. BTW, this was based on the "household" survey (a volatile one -- UPDATE: the survey's margin of error is 400K, a 46% margin of error!!!), rather than the "establishment" survey (the more reliable one).
WilWil242 posts since
Feb 26, 2010
Rep Points: 1,285
2. Friday, October 5, 2012 - 1:22 PM
Frankly, I've lost confidence and the willingness to trust most - if not all - numbers published by the government.  Like Wil, my first thought on seeing the headline was "What convenient timing".    The only timing that would have been more suspect was if it had been published on the actual day of the first debate. 
pearlbrownpearlbrown1,473 posts since
Nov 2, 2010
Rep Points: 6,404
3. Friday, October 5, 2012 - 2:23 PM
Mish in his Global Economic Trend Analysis blog has a good overview of this news with reasons why the rate went down so much and why the news isn't as positive as it might seem.
Ken TuminKen Tumin5,471 posts since
Nov 29, 2009
Rep Points: 125,634