Federal Reserve Chairman Jerome Powell made some remarks at a press conference early this morning that have drawn special attention from the media. It is said that his statements are tantamount to “admitting that the Biden administration is manipulating employment data.”
At the press conference following the FOMC meeting, a Bloomberg reporter asked Powell to comment on the state of the labor market. Powell responded by saying that the labor market was “overheated” two years ago and has now returned to “normal,” largely due to the “labor supply brought by immigration” (implying that illegal immigration is the main reason for increased employment, reduced wages, and thus lower overall inflation, a statement introduced to mitigate the widespread call to stop illegal immigration among most Americans).
However, when Powell discussed the demand side of the labor market, things became very interesting: he talked about a decline in quit rates, job vacancies, and wages, but more importantly, an increase in the unemployment rate from 3.4% to 4.0%, which is clearly at odds with the strong employment data. Powell summarized all of this as strong job creation but simultaneously cautioned that “there is a view that employment levels might be a bit exaggerated.”
Although Powell quickly realized what he had said and tried to cover it up by adding that “employment is still strong,” the narrative of a strong labor market suddenly collapsed because if the Biden administration is lying at one point in the employment report, it might be lying in any part of the report.
As Edward Snowden pointed out, the most shocking part is that he “had never seen a Federal Reserve Chairman publicly accuse the White House of tampering with employment data, but we are seeing it now.”
Financial blog Zero Hedge added, “You’ll understand if we make a little effort to dig beneath its pristine, false surface, then every so-called ‘strong’ employment report is a disaster. While we expected this scam to continue indefinitely, at least until the November election, when all the truths about the labor market’s ugliness would suddenly come to light, allowing the new president to take office amidst an economic crisis, we were still shocked when today it was none other than the Fed Chairman admitting the Biden administration is manipulating employment data.”
Zero Hedge pointed out that last Friday’s non-farm payroll report is the latest example. Although the establishment survey report did show an addition of 272,000 “jobs,” this number included holders of multiple jobs; excluding these, the actual number of “employed” workers dropped sharply by 408,000. This is also why the unemployment rate rose to 4.0% for the first time in over three years while job additions showed an astonishing “growth.” More importantly, this means that the ever-rising establishment survey employment data and the flat household survey data (which calculates the actual number of employed workers) have a staggering gap of 9 million, the largest gap in history.
But how did the non-farm report show an increase of nearly 300,000 jobs with an overall reduction of more than 400,000 in total employment? This involves another propaganda trick often abused by the U.S. Census Bureau—the “birth/death adjustment.” Zero Hedge said this is a statistical blur factor that estimates job growth for any specific month based on entirely subjective assumptions by a group of pro-Biden bureaucrats about how many new businesses are born (or die) in the U.S. at any given moment.
In May, the birth/death adjustment (recently exposed by Bloomberg) “added” 231,000 jobs to the pre-seasonally adjusted figures. More shockingly, over the past year, the birth/death adjustment resulted in 56% of “employment growth,” i.e., 1.9 million statistically “new jobs,” while according to the Bureau of Labor Statistics data, a total of 3.4 million “new jobs” were created during that period.
Zero Hedge stated that while the quantity of the employment report can be debated, the quality cannot: it is a huge disaster. “As we learned in May, no matter how many actual job increases there are (again, emphasizing this is not about job positions), what we know is that the trend of full-time workers shifting to part-time continues, with 625,000 full-time jobs lost in May, offset by 286,000 part-time jobs… this is not a new trend, in fact, in the past year, the U.S. lost 1.2 million full-time jobs, replaced by 1.5 million part-time jobs. Finally, there is one more data point worth noting, which we first highlighted more than a year ago and later became the biggest political issue involving the labor market: since 2018, the U.S. has created zero native-born jobs, with all job growth going to foreign-born workers. As confirmed by Standard Chartered Bank last week, almost all of these are illegal immigrants.”
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