There's something suspicious about the latest jobs report from the Bureau of Labor Statistics (BLS), which claims that the economy added 353,000 jobs in January—more than double what economists had predicted. Is it true? Most likely not, and I'll explain why.
For weeks now, there have been reports of mass layoffs in the tech industry, including at iRobot, Amazon, Google, and Meta, among several others. The news industry has also been plagued by mass layoffs in recent weeks. These layoffs weren't out of the blue, either. Newsweek predicted last month that "mass layoffs are in store for 2024, and it might end up affecting nearly half of companies."
But the Biden administration says everything is fine. Better than fine, actually.
"America’s economy is the strongest in the world," Joe Biden declared in a statement Friday. "Today, we saw more proof, with another month of strong wage gains and employment gains of over 350,000 in January, continuing the strong growth from last year."
But how legit are these numbers? Prior to the release of the report, Zero Hedge listed some (but not all) of the layoffs that were announced in recent months: Twitch (35% of workforce), Hasbro (20% of workforce), Spotify (17% of workforce), Levi's (15% of workforce), Zerox (15% of workforce), Qualtrics (14% of workforce), Wayfair (13% of workforce), Duolingo (10% of workforce), Washington Post (10% of workforce), eBay (9% of workforce), Business Insider (8% of workforce), Paypal (7% of workforce), Charles Schwab (6% of workforce), UPS (2% of workforce), Blackrock (3% of workforce), Citigroup (20,000 employees), and Pixar (1,300 employees).
This is not a sign of a strong, growing economy.
How much can the Biden administration's numbers be trusted? Well, not much. As Zero Hedge noted after the release of the report, "Once again there was a huge dispersion between the Establishment and Household Surveys, and while the former indicated an increase of 353K, the latter reported a drop in Employment of 31K!"
A chart comparing the Establishment and Household Surveys shows that while the reports have generally been quite close, there has been a growing disparity between them since June 2022.
Via @zerohedge: "it's safe to assume that all Establishment Survey numbers are now completely made up." pic.twitter.com/2j6h0SymRJ
— Matt Margolis (@mattmargolis) February 2, 2024
Moreover, in addition to the suspicious figure of 353,000 jobs added in January, Zero Hedge notes that overall employment actually dropped by 31,000, with full-time employment experiencing a decline of 63,000, while part-time positions saw a significant surge, increasing by 96,000.
Clearly none of that mattered to the BLS, however, which had just one mission: to make the Biden economy look double super good-good ahead of the November elections, and it wasn't just payrolls which blew away expectations, the unemployment rate also slipped, staying at 3.7%, vs expectations of an increase to 3.8%. That said, Among the major worker groups, the unemployment rates for adult men (3.6 percent), adult women (3.2 percent), teenagers (10.6 percent), Whites (3.4 percent), Blacks (5.3 percent), Asians (2.9 percent), and Hispanics (5.0 percent) showed little or no change in January.
Even the alleged wage increase the report boasted about is deceptive. A closer look reveals that this apparent wage growth is attributed to a decline in actual working hours rather than an authentic increase in wages. The average workweek for all employees on private nonfarm payrolls decreased by 0.2 hours to 34.1 hours in January—a 0.5-hour decline over the year, which is the lowest level observed since the thick of the pandemic.
It appears from the report that the BLS has been given the task of making the labor market appear strong and robust ahead of the election in November. Will it work? Did Biden's claiming for years that Bidenomics was working change attitudes about the economy?
