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The Household Survey says that 873,000 people started working last month. Really?? If the Fed knew that, would they still have started up QE3? If the rest of the government (e.g. the IRS) knew that, the President probably would have been talking about his ability to create jobs during the debate.
Were in the middle of a presidential election campaign and we know how bad the presidential polls can be. Two polls on the same day may disagree meaningfully. In fact, they probably vary more over time than people actually change their minds. The danger is that extrapolating from a relatively small sample to a far larger population creates uncertainty and volatility – and thats what were seeing in the Household Survey (summary below).
Household Survey Results
? Unemployment rate fell from 8.1% to 7.8%
? Estimated employment rose 873,000
? Number of unemployed fell 456,000
? Job losses slowed: the number of people unemployed for less than 5 weeks declined by 302,000
? Average weekly hours of work rose from 34.4 to 34.5 hours
? Average hourly earnings rose 0.3%
The Bottom line
I continue to think that the economy is emerging from its third annual summer soft patch, rather than sliding into recession (though the fiscal cliff may still cause one).