Before I tell you about the bombshell that was dropped yesterday, I must give the proper context. Don’t worry, I’ll make it quick!
For the last year or two the unemployment rate has been surprisingly low for all the chaos happening in the economy and it has been baffling everyone. But it has also been the one thing Biden, Powell, and Yellon have been leaning on when defending their policy decisions. “Strong labor market” we’ve heard it a million time this year.
To be honest I never felt these numbers were legit and when I get curious about things, I get obsessed. So I’ve been trying to understand this weird situation all year and the only source that has been diligently exposing the inconsistent numbers has been the great Zerohedge.
The two things the BLS had been doing was using part time jobs and monthly revisions to fluff the numbers.
So, imagine the U.S. population was only 100 people and 50 of them worked two jobs while 50 did not have a job. Should the unemployment rate be 0% or 50%? Well, the way the BLS measure it would make that number closer to 0%.
Chart from Zerohedge showing growth in part time jobs more than full time:
Second, the monthly revisions to the data has made employment look much stronger than it actuality was.
See chart from Zerohedge below:
This chart from Zerohedge really highlights how abnormal these revisions have been when compared to the years prior to 2021.
Now that we covered that we could talk about what happened yesterday. There was a revision made that basically did the opposite and showed that A TON of new job openings just hit the market. By A TON, I mean the amount the we only see during an economic crisis!
Chart from Zerohedge:
Here’s a visual of the revisions this from this week. For the last year the revisions made the employment data look strong and now it making it look awful.
PBD and the Home Team did a breakdown of this situation today on the podcast, check it out if you want to know more!
https://www.youtube.com/live/Qg4Sjc-jDrc?feature=share
Let me know what you think!
Sincerely,
Brandon
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