That’s the title of an article by Heritage’s EJ Antoni:
In the last quarter of 2023, these monthly job reports showed an increase of nonfarm payrolls by 637,000—robust growth, to be sure. But a much larger survey of businesses indicates this was a wild overestimation.
The BLS also publishes a Business Employment Dynamics, or BED, report each quarter, which comes from a much larger survey of 9.1 million private establishments. That’s more than 10 times the size of the survey used in the monthly job reports, so the BED has the law of large numbers on its side when debating accuracy.
This significantly larger survey showed only 344,000 jobs added in the final quarter of 2023, or roughly half the amount estimated by the monthly job reports. Contrary to the glowingly positive business news headlines each month, the labor market is not that strong after all. [emphasis added by MDC]
Interestingly, Dr. Antoni is comparing apples to oranges (NFP to private NFP). The correct comparison is private NFP to private NFP. I do this in the following graph.
Figure 1: Change in private nonfarm payroll employment in 2023Q4, in 000’s, from CES (blue), from Business Employment Dynamics survey (tan), from ADP (green), from QCEW seasonally adjusted by author using X-13 (red). Monthly series sampled at end-of-quarter. Source: BLS, ADP, and author’s calculations.
If 464K looks less than twice 344K, you’d be right. 637K, which is what Dr. Antoni mentions, is total nonfarm payroll employment, not private nonfarm payroll employment. Do the correct comparison, and it’s only a third smaller. ADP — not a survey based figure — has a value slightly higher than coming from the BLS’s BED. Now, the Quarterly Census of Employment and Wages (QCEW), upon which the BED estimate is based upon, is not seasonally adjusted as reported. I seasonally adjust the series using X-13 using log transform. The resulting number at 34K is much smaller so better suits the case Dr. Antoni is making. On the other hand, these figures, while not coming from a survey but rather a census, are preliminary. As more tax (withholding etc.) information comes in, they will be revised.
Perhaps it’s better to look at trends, rather than a single quarter’s worth of data. Here are cumulative changes over 2023.
Figure 2: Change in private nonfarm payroll employment since 2022Q4, 000’s, from CES (blue), BED (tan), ADP (green), BED (tan). All monthly series end-of-quarter. QCEW seasonally adjusted by author using X-13. Source: BEA, ADP via FRED, and author’s calculations.
Figure 3: Cumulative percentage change in private nonfarm payroll employment since 2022Q4, from CES (blue), BED (tan), ADP (green), BED (tan). All monthly series end-of-quarter. QCEW seasonally adjusted by author using X-13. BED cumulative gains normalized to QCEW 2022Q4 levels to calculate percentage changes. Source: BEA, ADP via FRED, and author’s calculations.
As of the end of 2023, private NFP had risen 2304 (1.7%) according to CES, while it had only risen 1820 (1.4%) according to the QCEW. So Dr. Antoni is correct that alternative measures suggest slower growth, but not as much as he implies in his article. For more employment comparisons against April 2023, see this post.
Dr. Atonji also has a more general critique of government statistics’ relationship to reality here.
As son as I read “Heritage” I knew there was a blatant lie that needed to be taken down. Good show.
“Why We’re Adding Far Fewer Jobs Than the White House Claims”
Geez – this dude loves flashly titles that mislead. Heritage quality research!
Donald Trump wants American cities to be like Caracas, Venezuela:
https://www.msn.com/en-us/news/politics/opinion-trump-s-adin-ross-interview-played-into-democrats-efforts-to-paint-him-as-weird/ar-AA1owZzI?ocid=msedgntp&pc=U531&cvid=b68cbc76832c46ba83bcc0478bbb3693&ei=22
Trump’s Adin Ross interview played into Democrats’ efforts to paint him as weird
Antoni is a normative economist. That is to say, he is more interested in how he thinks things should be than how things are. If you doubt this, just read his writings. Perhaps his inexperience with positive economics explains his errors when trying to do a simple comparison between data series. Odd, what with the PhD and all.
The other explanation is that he has wilfully made errors in order to make claims that aren’t true. The guy’s CV says he specialized in labor economics in grad school, so confusing total employment with private employment seems unlikely.
Once again, we’re left with the choice of either ignorance or dishonesty as an explanation for behavior. Look at his employment history for clues as to which.
EJ Antoni is a Research Fellow in The Heritage Foundation’s Grover M. Hermann Center for the Federal Budget. His research focuses on fiscal and monetary policy. His work has been featured with a variety of news outlets including Daily Caller, Fox News and Fox Business, Wall Street Journal, National Review, CNBC, Washington Times, The Center Square, Washington Examiner, Breitbart, The Federalist, and others.
That’s from his Heritage bio. Daily Caller, National Review, etc. Gee this dude is on par with Stevie Koptis!
I see he publishes in all of the high impact economic journals. a paragon of academic integrity and excellence. though I see he has yet to appear in mad magazine…
Yea even Steve Koptis has a pending publication in Mad Magazine where he explains the intersection of “suppression” and the Real Business Cycle model.
The rest of his bio:
Antoni’s research has also been featured with numerous think tanks and institutes including the Committee to Unleash Prosperity, where he is a senior fellow. Previously, he was an economist at Texas Public Policy Foundation, an economic consultant for FreedomWorks, and has taught courses ranging from labor economics to money and banking. Antoni holds master’s and doctoral degrees in Economics and frequently speaks at colleges and financial institutions.
Freedom Works and the Committee to Unleash Prosperity? Are you effing kidding me? Interesting he can’t tell us where he went to school or where he allegedly teaches.
Found a reference that said he got his degree from Northern Illinois University. Gee – do they even have an economics department?
I want to be fair to the economics department at Northern Illinois so here is the list of its faculty:
https://www.niu.edu/clas/econ/about/faculty-staff/index.shtml
Now I will let others figure out which of these faculty members are experts in labor economics. Their former student who works for Heritage certainly is not.
It seems Bruce Hall has been busy helping those disgusting allies of JD Vance with their Swift Boating of Tim Walz. Look who Brucie boy has been working with:
https://www.msn.com/en-us/news/politics/democrats-move-to-avoid-swift-boat-redux-in-attacks-on-walz-service/ar-AA1oxG6c?ocid=msedgdhp&pc=U531&cvid=49fc6dd701744459b70a59fbeca61019&ei=15*
On Tuesday, a few hours after Vice President Kamala Harris revealed she’d picked Minnesota Gov. Tim Walz as her running mate, the conservative radio host Erick Erickson posted a video from Walz’s 2022 reelection campaign attacking his military service record. The slickly produced video resembled a professional television news segment, but it came from a Minnesota website called Alpha News, which received a “red” unreliable rating from media watchdog NewsGuard because it fails to disclose it was founded by the head of a conservative advocacy group. In the video, an unidentified woman interviews Thomas Behrends, a Minnesota farmer who served in the state’s National Guard with Walz and faults him for retiring before the unit deployed to Iraq. Within minutes, Trump’s co-campaign manager, Chris LaCivita, promoted Erickson’s post and wrote on X, “IVE SEEN THIS ACT BEFORE — AND IT DOESNT END WELL …”
We all know about Lacivita and Erickson. Alpha News is a repugnant rightwing local rage. Thomas Behrends? A bought and paid for GOP hack who likes to hang with Laura Ingraham and pathetic NY Post. This is Bruce Hall’s kind of people – all liars and a disgrace to anyone who has ever served our nation.
Off topic – China’s economy:
https://archive.ph/xeSub
The FT writes about the weakness of household consumption growth and about calls for the government to focus on boosting demand.
One lens through which to consider China’s path from imposing the one-child policy to the result of that pick in today’s rapidly aging workforce is the dependency ratio.
Y’all know this ratio – number of non-working dependents relative to the number of workers in the economy. The one-child policy dramatically reduced China’s dependency ratio, thereby reducing household demand, creating saving that could be funneled into investment. In 1980, China had 68 dependents for every 100 workers. By 2020, that ratio had dropped to 44/100. Very good for capital accumulation.
Over time, the children become the workforce and the parents become dependent, and the process is thrown into reverse. The dependency ratio rises, working-age children face the prospect of paying for their parents in retirement. The UN puts China’s dependency ratio at 71/100 by 2050. That’s higher than it was in 1980 – bad for capital accumulation. Workers need to save now, so they can afford to spend when their parents retire. The poor performance of real estate and stock markets increases the need for saving now.
Those calling for consumption-boosting policies are facing an up-hill battle on the way to a rise in dependency, after which consumption will naturally pick up. When consumption picks up, savings will drop, investment will slow and China’s growth will depend very heavily on consumption.
A rapid rise in dependency means rapid economic adjustment. China can plan for that adjustment, or not. It will happen either way.
we must acknowledge that his military service is nothing compared to trump
Isn’t it amazing that Trump became the best baseball player in New York (better than Derek Jeter) with his bone spurs and bad knees?
WOW, Aussies sarcasm is very severe and dark. I feel you my friend. Wow, but , yeah.