The Obamacare Discrepancy in Jobs

Townhall.com ^ | January 12, 2014 | Mike Shedlock

[Kaslin]

The wide discrepancy between jobs and employment continues for a third month.

Jobs vs. Employment Discussion

Before diving into the details, it is important to understand limits on data, and how the BLS measures jobs in the establishment survey vs. employment in the household survey.

Establishment Survey: If you work one hour that counts as a job. There is no difference between one hour and 50 hours.
Establishment Survey: If you work multiple jobs you are counted twice. Neither the BLS nor ADP weed out duplicate social security numbers.

Household Survey: If you work one hour or 80 you are employed.
Household Survey: If you work a total of 35 hours you are considered a full time employee. If you work 25 hours at one job and 10 hours at another, you are a fulltime employee.

Following are numbers from today's BLS jobs releases.

December 2013 vs. December Prior Years

Category	DEC 2008	DEC 2009	DEC 2010	DEC 2011	DEC 2012	DEC 2013
Employed Household	143,369	138,013	139,266	140,836	143,212	144,586
Jobs Establishment	134,425	129,373	130,395	132,498	134,691	136,877

Monthly Averages December 2013 vs. December Prior Years

Category	DEC 2009	DEC 2010	DEC 2011	DEC 2012	DEC 2013
Yoy Change Household	(5,356)	1,253	1,570	2,376	1,374
Yoy Change establishment	(5,052)	1,022	2,103	2,193	2,186
Monthly Average Household	-446	104	131	198	115
Monthly Average Establishment	-421	85	175	183	182

Notice how closely in sync the household survey has been to the establishment survey in terms of average gains or losses. A divergence developed in 2013.

Here is the data I posted last month (I did not check for revisions).

November 2013 vs. November Prior Years

Category	Nov 2008	Nov 2009	Nov 2010	Nov 2011	Nov 2012	Nov 2013
Employed Household	144,100	138,665	139,046	140,771	143,277	144,386
Jobs Establishment	135,130	129,593	130,300	132,268	134,472	136,765

Monthly Averages November 2013 vs. November Prior Years

Category	Nov 2009	Nov 2010	Nov 2011	Nov 2012	Nov 2013
Yoy Change Household	(5,435)	381	1,725	2,506	1,109
Yoy Change establishment	(5,537)	707	1,968	2,204	2,293
Monthly Average Household	-453	32	144	209	92
Monthly Average Establishment	-461	59	164	184	191

Last month the discrepancy between reported employment and reported jobs was 191,000 - 92,000 = 99,000.

This month the discrepancy between reported employment and reported jobs is 182,000 - 115,000 = 67,000.

These discrepancies started in 2013.

I asked the BLS to take multiple social security numbers into consideration. They cannot because all they have is raw counts. ADP could, but wouldn't, citing privacy issues.

However, there are no privacy issues. A program would be trivial to write, but most likely one would not even have to do that. A sort utility extracting and counting duplicate social security numbers would suffice.

I believe Obamacare is the reason for the discrepancy.

Obamacare Effect

Prior to Obamacare
34 hours worked = 1 parttime job household survey
34 hours worked = 1 job establishment survey

Enter obamacare
Person cut back to 25 hours and takes a second job for 10 hours
Here is the new math

25 + 10 = 1 fulltime job on the household survey.
25 + 10 = 2 jobs on the establishment survey.

In my example, the household survey totals up all the hours and says, voilla! (35 hours = full time). So a few extra hours that people pick up working 2 part time jobs now throws someone into full time status – thus no surge in part-time employment, but there is a surge in jobs.

Establishment Survey Jobs Surge Ended This Month

Interestingly, the surge in jobs in the establishment survey ended today. See Big Miss: Nonfarm Payrolls +74,000 vs. 205,000 Expected; Unemployment Rate 6.7% as Labor Force Shrinks by 347,000.

Two Possibilities

1. Perhaps today's weak job report is a one-time thing. Some economists blamed the weather.
2. The other possibility is the Obamacare effect has mostly played out, and Establishment Survey results going forward will not get a multiple job boost for the rest of the year.

If the Obamacare multiple job surge has indeed played out, monthly establishment survey job gains are going to be weaker than most expect for 2014.

[Rennes Templar]

There is no relation between jobs and employment in the Obama economy.
As long as the illusion of recovery stays strong, all is well.

[Diana in Wisconsin]

How I LOATHE our current Congress. How I LOATHE our current CIC.

As an employer, the above is true. I’ll be hiring for our busy spring season, but that will be 29 hours MAX a week for 12 weeks, then - SEE YA! Not a lot above minimum wage, either! You can make a whopping $2,000.00 in that period, after taxes, of course! That should set a family up quite nicely for the remainder of the year. *GAG* (I won’t hire HS kids; they’re lazy IDIOTS!)

It’s going to be ugly. And I am going to tell EVERY 0bama-voter, complaining customer (and I am in The Belly of the Beast here in Madistan!) that our lowered service standards or lack-thereof the EXACT reason why our business is hamstrung: 0bamacare.

[Don Corleone]

Next month they will increase the chocolate ration again too. Ain’t Communism wonderful?

[Dr.Deth]

But the unemployment rate is down to 6.7%, which you will hear ad nauseum straight thru the Driving The Stake Through The Union Show later this month.

[Cringing Negativism Network]

The democrats are wildly disrupting our nation’s employment statistics.

They are no longer even close to accurate.

That said, the GOP needs to get back to supporting American manufacturing.

Now.

[Jack Hydrazine]

From the article, 'Explaining the Flaw in Kevin Drum's Climate Chart.'

Here are the individual performances of each president since 1948:
1948-1952 (Harry S. Truman, Democrat), +4.82%
1953-1960 (Dwight D. Eisenhower, Republican), +3%
1961-1964 (John F. Kennedy / Lyndon B. Johnson, Democrat), +4.65%
1965-1968 (Lyndon B. Johnson, Democrat), +5.05%
1969-1972 (Richard Nixon, Republican), +3%
1973-1976 (Richard Nixon / Gerald Ford, Republican), +2.6%
1977-1980 (Jimmy Carter, Democrat), +3.25%
1981-1988 (Ronald Reagan, Republican), 3.4%
1989-1992 (George H. W. Bush, Republican), 2.17%
1993-2000 (Bill Clinton, Democrat), 3.88%
2001-2008 (George W. Bush, Republican), +2.09%
2009 (Barack Obama, Democrat), -2.6%

Let’s put this data in a chart:

[Kaslin]

uh huh

[Kaslin]

And only 74,000 new jobs were created.

Who do they think they are kidding?