Check out this article. Or this one. Or this one, or this one. Gloomy, huh?

In fact, even a notable optimist's first reaction might be to replace the cowbell:

with the cow:

But the news may not be all bad, after all. First, obviously, is the fact that payroll employment increased (even if not as much as expected). Second, the number of unemployment claims declined over last month.

Finally, and most importantly, look at the unspun release from the BLS and try to interpret that as anything but positive. Overall household employment increased by 629,000 over the previous month. For better perspective, take a look at this chart:

(from this site).

That's right. July saw the largest increase in household employment since February 2002. And for only the second time since August 1994, more than 600,000 jobs were created in a month.

Why, then, the gloomy news reports about the increase of only 32,000 (versus the forecast of 240,000). Two words: old economy. These BLS surveys and predictions are all predicated on the 9-to-5, 5-day-a-week, clock-punching job sector. They miss the ever-larger numbers of self-employed workers who make our economy a vibrant example of Schumpeter's creative destruction.

Of course, I'm not the first to note this, by any means. This particular post was inspired by Dr. Jeffrey Cornwall of The Entrepreneurial Mind. And Virginia Postrel has lucidly stated and developed this theme repeatedly in the past.

Thank goodness we can so readily access the raw data to critique the common wisdom (or at least the "commonly-reported" wisdom) about the job figures.

Update: Reading through the above, I noted some sloppiness in the paragraph starting "Why, then, . . . . " Instead of saying "these BLS surveys, " I should have written "the BLS payroll survey." Sorry for the sloppiness.

For a well-written leftist analysis of the BLS report, read this EPI article, which goes through all the numbers and explains why more weight is commonly given to the payroll survey than the household survey. I don't agree with the EPI's ideological slant, but it does help explain the conventional wisdom.

Posted by: JohnL at 11:37 PM | Comments (4) | Add Comment
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