Forbes Media Chairman Steve Forbes and former CKE Restaurants CEO Andy Puzder have cast doubt on the accuracy of the U.S. jobs report, pointing out discrepancies that suggest the job market is not as healthy as the government suggests.
According to the Bureau of Labor Statistics, the government quietly erased 439,000 jobs through November 2023. This indicates that the initial jobs results were inflated by 439,000 positions, leading to a misrepresentation of the job market.
The increase in government hiring has been a driving force behind the inflated jobs numbers. In fact, the government sector ranked high in job creation in December, adding 52,000 jobs in the final month of 2023. This trend has raised concerns about the sustainability of this level of government job creation.
Additionally, the health care and social assistance sector, which relies heavily on government spending, created about 59,000 jobs, further indicating the role of government influence in the job market.
This is not the first instance of overstated jobs numbers. In August 2023, a preliminary revision for the 12 months through March 2023 showed that U.S. job growth for that period was overstated by a net 306,000 jobs.
The accuracy of the jobs report has been a topic of concern. The Philadelphia Federal Reserve Bank predicted that the BLS had overreported jobs growth by 1.1 million in the second quarter of 2022, further undermining the credibility of the reported numbers.
Furthermore, economists and market analysts have criticized President Biden for taking credit for job creation, pointing out that the U.S. economy has only “added back” all the jobs lost in the pandemic and has “created” 4.86 million jobs since February 2020.
The job market also faces challenges such as a historically low labor force participation rate, with a record high number of people holding multiple jobs to make ends meet. Additionally, the economy has lost 1.5 million full-time workers since June of last year, while adding 796,000 part-time workers. This indicates a trend of workers holding multiple jobs to cope with the rising cost of living, driven by a cumulative 17.4% inflation rate under the current White House administration.
The critical assessment of the jobs report by industry experts highlights ongoing concerns about the accuracy and reliability of the government’s reporting on the state of the job market, including its potential impact on market movements and Federal Reserve decisions. This raises important questions about the real health of the job market and the relevance of the government’s reported numbers.