published Saturday, October 6th, 2012

Conspiracy theorists question jobless rate

Dozens of job seekers line up to enter a National Career Fair in New York.
Dozens of job seekers line up to enter a National Career Fair in New York.
Photo by Associated Press /Chattanooga Times Free Press.
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Are the unemployment numbers accurate?

WASHINGTON — Conspiracy theorists came out in force after the government reported a sudden drop in the U.S. unemployment rate Friday, one month before Election Day. Their message: The Obama administration would do anything to ensure a November victory, including manipulating unemployment data.

President Barack Obama, reeling from a poor debate performance, did win a valuable reprieve with a reduced unemployment number in September that brought the jobless rate down to a level unseen since January 2009 when he took office.

The Labor Department announced that the unemployment rate had fallen to 7.8 percent in September from 8.1 percent the month before.

The new threshold carries more political than economic weight. The Labor Department reported that employers added 114,000 jobs in September, slightly better than expected but still below levels needed to sustain a reduction in unemployment.

But the report held several good signs for Obama as he and rival Mitt Romney enter the final four weeks of the presidential campaign in an election dominated by the economy and high unemployment. The economy created 86,000 more jobs in July and August than initially estimated, a sign of the volatility of the jobless reports and their unreliability as a snapshot of the economy.

The Labor Department also reported wage growth in September, evidence of more people looking for work.

Still, Romney cast the new reports as further sign of a weak economy under Obama.

“This is not what a real recovery looks like,” he said in a statement, noting that the figures showed fewer jobs created in September than in August and, that if people who have dropped out of the labor force were counted, the unemployment rate would be closer to 11 percent.

The conspiracy charges were widely rejected Friday. Officials at the Labor Department said the jobs figures are calculated by highly trained government employees without any political interference. Democrats and even some Republicans said they also found the charges implausible.

Yet that didn’t stop the chatter. The allegations were a measure of how politicized the monthly unemployment report has become near the end of a campaign that has focused on the economy and jobs.

The conspiracy erupted after former General Electric CEO Jack Welch, a Republican, tweeted his skepticism five minutes after the Labor Department announcement.

“Unbelievable jobs numbers ... these Chicago guys will do anything ... can’t debate so change numbers,” Welch tweeted, referring to the site of Obama campaign headquarters.

The drop in unemployment was announced two days after Obama’s lackluster performance in his first debate with Republican challenger Mitt Romney.

Republican Rep. Allen West of Florida soon announced via Facebook that he agreed with Welch.

“Somehow by manipulation of data we are all of a sudden below 8 percent unemployment, a month from the presidential election,” West wrote. “This is Orwellian to say the least.”

The Obama administration wasn’t given much time to gloat about the strong economic improvement. Instead, it had to defend statisticians and economists against accusations made without any supporting evidence.

“No serious person ... would make claims like that,” said Alan Krueger, chairman of the White House Council of Economic Advisers.

The jobs report is prepared under tight security each month by a relatively obscure government agency — the Bureau of Labor Statistics — without any oversight or input from the White House. It is based on data collected by an army of census workers, who interview Americans in 60,000 households by telephone or door-to-door.

Eight days before the unemployment rate is made public, the bureau’s office suite goes into lockdown. Tom Nardone, a 36-year veteran at the agency who oversees preparation of the report, keeps crucial papers in a safe in his office.

A big reason for the security has nothing to do with politics. The data could move financial markets if it were released early.

“These are our best-trained and best-skilled individuals,” Labor Secretary Hilda Solis said on CNBC. She called the claims of manipulation “ludicrous.”

The BLS, the statistical division of the Labor Department, collected and analyzed data and calculated the unemployment rate before Wednesday night’s presidential debate.

Joel Naroff, president of Naroff Economic Advisors, said that it’s “not that unusual” for the rate to move by three-tenths of a percent in one month. It’s happened 12 times in the past 10 years.

“In other words, at least once a year, you should expect that large a move,” he said in an email to clients. It last happened 20 months ago, “so we were overdue. That is just the reality of the data.”

Romney didn’t discredit the government data. But plenty of conservatives did that work for him.

Rep. Paul Broun, a Maryland Republican, weighed in with a statement saying the report “raises questions for me, and frankly it should be raising eyebrows for people across the country.”

Economists offered more plausible reasons for skepticism. A big chunk of the increase in employed Americans came from those who had to settle for part-time work: 582,000 more people reported that they were working part-time last month but wanted full-time jobs.

Conspiracy theories are nothing new for Obama. He has been dogged by discredited claims that he wasn’t born in this country and that he is Muslim.

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