GIGO is a common term which was in use among computer programmers first, and then it moved into nearly any area where data was used or manipulated. It seems to some in the economic arena that the Bureau of Labor Statistics (BLS) is more heavily engaged in GIGO than is helpful to government planners, the Federal Reserve and businesses who depend on the data for short or long term forecasting of economic trends.
One writer at The NY Times
suggests it's an area of concern for the Federal Reserve and is creating a problem for the Fed to be able to figure out just how bad off the economy really is.
It's been noted rather often that the real unemployment rate in the US is much higher than the numbers the BLS touts on a weekly basis, the question being just how bad is it? A table of recent U-6 rates
is available at the BLS website.
reports numbers which should scare even the toughest politician, and definitely spell doom and gloom for the current President in his bid to be re-elected.
Overall the national U-6 number has changed in a positive fashion, but only if compared to the 2007 numbers.
In 2007, the U-6 unemployment rate was 17.2%, today the number reported is 14.9%
Yes, nearly 15% of Americans who want, need and desire to work are unemployed or seriously under employed. A carpenter, factory worker or office worker who was making $30K-$50K or more, is now either not working or is working at a job and making a small percentage of the former income.
The above numbers are the best of the group, the national number of under and unemployed, the state by state numbers in some cases are staggering in their proportions of Misery Index
. The problem with Arthur Okun's Misery Index (unemployment [8.2] + inflation [1.66] = 9.86) being that it is using the "Official Unemployment rate of 8.2%, rather than any real number.If the real unemployment number of 14.9% were used, the Misery Index would be an insurmountable obstacle to the current President's re-election at 16.56. Keeping in mind that the highest MI was the result of the Carter years when it hit 21.98.
In the state of Nevada, the U-6 number is a whopping 22.1%, almost one in four without sufficient work to pay the bills, Florida, one of the battleground state in the upcoming election has a U-6 rate of 17%.
One problem since the BLS has begun using 'seasonally adjusted' rates is the fluctuation in the adjustments, and the lack of accuracy in the reports being produced. The July adjustments
across the past ten years has been off by nearly 62%. A failure to correctly report such an important number by 62% brings to the forefront the question of "Why bother to report bad numbers?"
The jobs report which will be released on Friday will almost certainly be massaged to paint as rosy a picture as is possible in relation to the actuality of so many Americans struggling to get by, but the real index of misery is the number of Americans who need some real action by the President and the Senate, both of whom appear to be vastly more concerned with the jobs report which will be released on November 7th of this year, and who gets to keep their cushy government Congressional job, or their extremely cushy Presidential status.