Posted on 02/01/2004 6:06:51 AM PST by nwrep
LeeAundra Temescu
Sat Jan 31, 8:39 AM ET
By Andrea Hopkins
WASHINGTON (Reuters) - According to the most widely accepted measure of U.S. employment, public-speaking coach and consultant LeeAundra Temescu was not among the 130 million Americans who had a job in 2003.
But don't try telling her that.
"Was I working?" the Los Angeles resident said. "In terms of speaking and writing and marketing and doing all that sort of stuff -- yeah, I was working."
Because she is one of more than 15 million self-employed workers in the United States, Temescu is on nobody's payroll -- and thus does not show up on the Labor Department (news - web sites)'s employer survey used each month to assess the strength of the job market.
The failure of the survey to count independent contractors has come under fire by President Bush (news - web sites)'s economic team and some analysts, who argue it underestimates job growth by ignoring one of the fastest-growing sectors of the economy.
"There is a big error factor in those numbers," Treasury Secretary John Snow said after Labor reported a scant 1,000 rise in December payrolls. "I think they may well have understated (job growth), and we will see a restatement in the future."
A rise in self-employed and other nonpayroll workers would bolster the argument of Bush supporters that the "jobless" nature of America's recovery has been exaggerated.
LIES, DAMN LIES AND STATISTICS
While outsourcing is not new, a rise in self-employed contractors could explain the slow rebound in employment as counted by the payrolls survey, which shows 2.3 million jobs have been lost since Bush took office in January 2001.
For the same period, a smaller study of households, based on the Current Population Survey, shows a 700,000 rise in employment -- a seemingly contradictory sign that has fueled Republican skepticism about the accuracy of the bleaker payrolls data.
According to the Current Population Survey, the number of self-employed Americans surged 3.9 percent in the last three years, far outstripping a 0.6 percent rise in overall employment.
But experts also take issue with the household survey, saying it is too small, too volatile and possibly overstates population growth. Moreover, it registers a worker as employed even if he or she works only one hour in the survey week.
Federal Reserve (news - web sites) Governor Ben Bernanke said the household survey's accuracy could also suffer if individuals misunderstand the questions "or for one reason or another misreport their own labor market status or that of other members of the household."
Self-employed consultant Temescu agrees. For much of 2003, she was one of 60,000 surveyed for the household report. Trying to categorize herself as "employed" or "unemployed" was tough in a week when she had no paying clients but was busy marketing. And she said the Census Bureau (news - web sites) questioners were just as confused about her employment status.
"There were a lot of times when I'd give an answer and they'd go 'Oh, I don't have a code for that'," she recalled. "It was kind disconcerting to ... have to give answers that I know weren't accurate because I was constrained by the nature of the questionnaire."
WAVE OF THE FUTURE
As president of SurePayroll, the fifth-largest U.S. payroll services provider, Michael Alter has seen a definite shift away from the traditional employer-employee relationships captured by the payroll survey.
Last year, payments by his small business clients to independent contractors surged 12 percent -- and Alter himself says he is using more contract workers.
"I personally believe there has been a structural change," he said. "You can get people who have very specialized skills for a very reasonable price, and you don't have to put them on staff full-time."
Economist Joel Naroff believes the outsourcing trend, which took off in the 1990s, is here to stay.
"Businesses have been looking to temporary help or outsourcing to lower their employment -- and therefore their health care and pension and other responsibilities," he said.
Government data show employment costs rose 3.8 percent in 2003. Outsourcing work to a self-employed contractor cuts those costs by up to a third -- because health care, pensions and other benefits make up 30 percent of total compensation.
"Clearly these kind of huge increases in health care costs encourage businesses to move toward temporary help, outsourcing, or setting people up as consultants," Naroff said. "It's clearly getting stronger."
Meanwhile, Temescu shrugs off the government's inability to accurately count her employment and says the benefits of her situation are worth the risks involved.
"The alternative of working as a salaried worker in an organization is even more unpalatable," Temescu said. "There is just something about working for myself -- I really, truly do love what I do."
but then that picture loaded and it got my attention! but I quickly realized that, if they had to attach that pretty face to the article, I'm sure I don't need to read it.
Throwing insults and calling names doesn't help you win an arguement. It's true and fine that some individuals are entrepeneurs, but when the average IQ is 100 --- I would think about half or more are not quite going to have the skills. It's excellent that some people lose their jobs and manage to have the money saved up to start their own business and are willing to risk that money (or is the government providing many of them loans??? which means it's not their money they're risking), but not everyone -- not the majority --- is in a position to do this.
You're right, but that's not the point. So spending went up from 6 trillion to 7 trillion;
But the economy grew more:
If it goes to 100 trillion on the day that my daily earnings are 200 trillion, I promise to pay for the entire federal budget out of my own pocket.
Ain't I a swell guy?
Even after a bad day at work, you at least have food for the table.
It depends on the price. Lots of people are willing to work for an evil corporate pointy haired boss-man --for a few hundred grand per day. I'd bet that at least half the freepers on this very thread will accept that pay even mind of the boss was Mexican!
Hey you're right. The Depression apple sellers also had their own health plan. - "An apple a day, keeps the Doctor away."
It was the entrepreneur who made this country what it is today.Individuals with a dream who stuck with it through thick and thin to make it work.
DO you know General Motors was started by couple of brothers by the name of Chevrolett back in the early 1900s. The same way with Chrysler Co.(Dodge Brothers).DuPont Co. was started out in the 1800s by a guy named DuPont who realized he could make alot of money making gunpowder and selling it to settlers heading west.
Are there still opportunities out there.YOU BET!The only thing stopping anyone is their belief in oneself.There are also politicians and government bureaucrats who hate the small business man.
They regulate the hell out of us and when we make a fair profit for our hard work they call us the greedy rich.
Then you get people like Waterstraat here who are jealous because they are too chicken to do anything on their own and can't stand seeing anyone who does.I know that for a fact,because my dad was that way.
He had a chance to start a business when I was kid.Joined a union instead and worked for the guy who started the business.My dad retired with a pension and the guy who started the company sold it for $7,000,000!My dad hated him all the years he worked for him and I blame the union for that.They polluted his mind one union boss told him to his face that he was better off working for them than starting his own business!
Having the government use it's guns to extort money from you for me is unconstitutional, morally, and ethically wrong
You have a lovely way with words. Well done!
Where are they?
The government's Current Population Survey (CPS), also known as the household survey, and the Current Employment Statistics survey (CES) get different employment numbers. Meanwhile there are many American trying to put their lives back together as politicans play numbers games.
I believe that the official unemployment rate is determined from the household survey of 60,000. Then after accounting for increases in population provided by Census estimates the number of employed is caluculated using the estimates and the official unemployment rate. To wit,
A recent month's BLS figures show 138,603,000 employed in a labor pool of 147.3 million (estimated population figures). How did they get the figure of 138.6 million employed? The BLS report stated:
"Total employment increased to 138.6 million in November. . .Both the unemployment rate, 5.9 percent, and the number of unemployed persons, 8.7 million, were essentially unchanged in November." [end excerpt]
Now, 100.00 - .059 = 0.941 and 0.941 times 147.3 is 138.6 jobs.
More estimated population more jobs created? Does that make sense? Yet some compare the 138.6 million figure to the past and claim hundreds of thousands of new jobs have been created.
A pro-CPS source says the CES survey shows job loss but disputes it, "Since the Household Survey's job count bottomed out in January 2002, it's shown 1.8 million new jobs added to the economy through last month. At the same time, though, the Establishment Survey (CES) has shown 817,000 jobs lost." (September, 2003)
Some say CES is more accurate. "The payroll survey [CES] samples 400,000 business establishments. This represents an average of 40 million jobs each month; in September 2003, 40.5 million jobs were sampled (Getz 2003). In contrast, the household survey [CPS] samples only 60,000 households, representing fewer than 70,000 workers. In September 2003, employment estimates were based on a sample of 67,804 workers. Thus, the payroll survey sample covers 600 times as many workers as the household survey."
Some say CES should include "self-employed," the source of many "new" jobs identified by the CPS. To wit, "A second critique of the payroll survey is that it leaves out self-employment. However, because the household survey employment reports do not distinguish between the self-employed who are gainfully employed and those who are searching for work -- and because the numbers of self-employed nonearners would be expected to increase during tough economic times -- the omission of self-employment numbers from the payroll survey may more accurately reflect overall employment trends." [my emphasis]
The quotes are from
"Measuring employment since the recovery A comparison of the household and payroll surveys, by Elise Gould, Dec., 2003 (The Economic Policy Institute)
http://www.epinet.org/content.cfm/briefingpapers_bp148
How different are the numbers? The CPS says jobs have been created. The CES says, "Since the beginning of the recession, employment has fallen by 2.4 million jobs. Since the end of the recession two years ago, there have been about 726,000 jobs lost, marking this as a period of 'jobless recovery.'"
http://www.bls.gov/news.release/empsit.nr0.htm
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