Byline: Alfred Tella, SPECIAL TO THE WASHINGTON TIMES
The spike in the unemployment rate from 5.7 percent in July to a five-year high of 6.1 percent in August left forecasters with egg on their faces. No change or a slight uptick had been expected.
Even with the 84,000 August drop in nonfarm payroll jobs, the eighth monthly job decline in a row, last month's jump in unemployment was out of proportion to the weakness in employment. There are lags and catch-ups in economic data, so one month doesn't tell the story. A closer look shows the employment-unemployment relationship has been out of historical whack all year. Insofar as economic forecasters are empiricists who rely on past behavior for guidance, recent underestimates of joblessness are understandable.…
Questia, a part of Gale, Cengage Learning. www.questia.com
Publication information: Article title: Unemployment Surprise. Contributors: Not available. Newspaper title: The Washington Times (Washington, DC). Publication date: September 9, 2008. Page number: A21. © 2009 The Washington Times LLC. COPYRIGHT 2008 Gale Group.
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