When looking at monthly jobs numbers from the Bureau of Labor Statistics, it's important to consider the so-called "household survey" along with the "establishment" or "payroll survey." Editors with an anti-Bush agenda can - and do - carelessly cobble together reports that somehow manage to leave out the specific data provided by the latest "household survey."

That's convenient, because while the payroll survey results may or not be impressive in a given month, the household survey shows a whole 'nother sector, experiencing significant growth: including self-employed, non-payroll workers.

Today's New York Times explains:

July was a poor month for job creation in the United States.

July was an excellent month for job creation in the United States.

That tale of two employment reports is true, and it continues a trend that has persisted for two and a half years. The discrepancies have made it possible for Republicans to herald a job recovery and for Democrats to deny one exists.

Both sets of statistics were issued by the government's Bureau of Labor Statistics, but they come from very different surveys. One, the establishment survey, which questions 160,000 employers, paints the bleak picture. The other, the household survey, which questions 60,000 people about whether they or other family members are working, paints the better picture.

Which is right? Because of its smaller sample size, the household survey is always more volatile, and month-to-month changes can be deceptive for that reason. So economists normally pay more attention to the establishment survey. But the fact that they differ so drastically may mean that reality lies somewhere in between.

Over all, the household survey now shows that employment has risen by 1.9 million jobs, or 1.4 percent, since President Bush took office, while the establishment survey shows employment is down by 1.1 million jobs, or 0.8 percent.

...The household survey, on a seasonally adjusted basis, showed a gain of 629,000 jobs in July. Before seasonal adjustment, the gain was an even larger 839,000 jobs.....

The household survey is used to calculate the unemployment rate, which fell to 5.5 percent in July, the lowest figure since October 2001.

....the two surveys have fluctuated, but the establishment survey has continued to paint a bleaker picture than the household one.

Making it fairly essential, in the interest of unbiased reporting, that editors give equal play to both major BLS surveys when the monthly jobs figures are released.

Considering the political volatility of econmic news in this crucial election year, newspaper ombudsmen might take a bit of time away from fatuous puff pieces to delve into their paper's real record of reporting on the always-ballyhooed BLS monthly data.

And front-page and national editors would be well-advised to ensure the full story is told each month, not just the part that fits their own political biases.

If the shoe fits, wear it.

Posted by Matt Rosenberg at August 7, 2004 08:10 AM

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