A flashback to a CNN article from just before the 2004 election era shows just how unbelievable today’s new unemployment numbers are.
In September 2004, new numbers came out, showing a drop in unemployment from 5.5% to 5.4%. At that time, with a much lower unemployment number than we have today (around 8% today), the increase in new jobs that caused a 0.1% decrease in unemployment was 144,000.
So, let’s get this straight. With 144,000 new jobs in a smaller U.S. population (about 295 million in 2004 vs. about 314 million today), you get a drop in unemployment by 0.1%. But now, 8 years later, with a greater population, you get 114,000 new jobs and, somehow, you get an even larger drop in unemployment: from 8.1% to 7.8%?
That just makes no sense.
It’s like saying that putting 1 gallon of gas into a 10-gallon gas tank constitutes filling 10% of the gas tank in 2004. But putting 3/4 gallon of gas into an even larger, 11-gallon gas tank in 2012 constitutes filling 12% of the gas tank.
From that same article, John Kerry’s senior economic advisor, Roger Altman, noted his disappointment with the mere 144,000 new jobs for that month in 2004, stating “[y]ou need about 150,000 new jobs a month to keep even with growth in population…. Taken in proper context, it’s just not a very good record.”
In proper context.
Well, in proper context, 144,000 new jobs creating a 0.1% decrease in unemployment in 2004 does not explain how 114,000 new jobs makes for an even larger drop in unemployment with an even larger population in 2012.
If we were really seeing an authentic drop in unemployment, that would be cause for celebration. But these new numbers and their illogical implications represent cause for inquiry and alarm.