Poof: Another 800,000 Jobs Disappear

by Chris Isidore - Februaru 4th, 2010 - CNNMoney.com

The problem is that BLS models appear to have grossly overestimated the number of new businesses that opened during the recession.

The payroll number is created through a monthly survey of employers, but that survey misses employers who start a business during the course of the year, as well as those who have gone out of business.

So every month BLS uses what is known as a birth-death adjustment to estimate the number of jobs created or lost from that turnover in business.

During the April 2008-March 2009 period, that adjustment added jobs to the overall payroll number in 11 of the 12 months, resulting in a net gain of 717,000 jobs [when the actual number should have been a loss of close to 100,000].

"When the numbers were coming out, the idea that we had a significant number of businesses being created didn't make sense," said Baker.

There is a concern that this problem didn't end in March of 2009. In fact, the adjustment added even more jobs -- 990,000 -- in the nine months reported since then.

So another big revision in the payroll numbers could be looming a year from now. That means this Friday's report should give pause to anyone who is depending on the official numbers to signal real improvement in the economy.

If you think the recession is showing signs it is over you are deluded. A year from now it is likely that another million fictitious jobs well be deleted from our government numbers and the actual unemployment will be raised by a couple of percentage points.

Unemployment is currently growing faster than the government can adjust through fictitious estimated jobs. That should create serious doubt about the Obama regime's current published lies.