Lots More on the Big Problem With the Monthly Jobs Report
Odd Lots
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NFP Limitations
The NFP's initial estimates are often revised downwards. The BLS's birth/death adjustment model, which accounts for new and closed firms, uses a simple model that was adequate when directionality was the primary concern. However, now the precise NFP number is important, making the model's inherent bias problematic. This birth/death adjustment consistently adds approximately 100,000 jobs monthly. Business Employment Dynamics data, though lagging, shows tanking employment growth from both continuing and newly opened firms, contrasting with the NFP's consistent reporting of job creation from new firms.
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