This morning after the BLS reported that the nation’s unemployment rate fell to 7.8 percent, Chapwood Capital Investment Management Managing Partner Ed Butowsky told Fox Business, “I feel like I’m watching a movie. There is no way in the world these numbers are accurate.” And Butkowsky was not alone. Former GE CEO Jack Welch tweeted: “Unbelievable jobs numbers…these Chicago guys will do anything. Can’t debate so change numbers.”
While it is highly improbable that BLS conspired to cook the books, there is still a huge 756,000 job gap between the number of jobs employers told the Labor Department they created in September (114k), and the number of Americans who told the labor department that they got new jobs (873k). As the chart below shows, these two numbers never match up perfectly, but this month’s gap, particularly the spike in Americans saying they found jobs, is striking:
While you normally hear the Employer survey number in headlines, it actually has nothing to do with the unemployment rate that also gets reported. The Household survey controls that. And the driving reason the unemployment rate fell from 8.1 percent in August to 7.8 percent in September, is because BLS claims almost one million Americans found jobs last month.
A million new jobs in a month? Does that sound anything like the economy you and your neighbors are living in?