Last week, when the Bureau of Labor Statistics reported a blow out number (which as we showed extensively [7]left much to be desired for anyone who dug even briefly below the surface), the US media, like an obedient dog, lapped it all up without as much as a peep questioning the credibility of this number.
Fast forward to last night [8], when in the second "stellar" jobs report in one week, we learned that instead of creating a mere 15,000 jobs as consensus expected, Australia added a whopping 58,600 jobs in October - the biggest monthly jump since 2012 - the vast majority of which were full-time.
[9]
Considering the implosion in the Chinese commodity sector, we were rather skeptical of this report: after all where is this economic demand for labor coming from if Australia's biggest trading partner is hunkering down at a pace last seen during the financial crisis.
We thought that just like in the case of US payrolls, our skepticism of Australia's "stellar" jobs report would not be echoed anywhere else.
How wrong we were, because overnight we were stunned to learn that unlike the US, Australia actually still has a fourth estate that not only reports data, but also dares to question it.
Here is what Australia's original media outlet, ABC, said in a report titled simply "don't believe the jobs figure for October": [10]
A fall in the unemployment rate from 6.2 per cent to 5.9 per cent in the space of one month?
Be sceptical. Treat with extreme caution.
Nearly 60,000 jobs created in Australia last month? A fall in the jobless rate in Victoria of 0.7 percentage points? Predictably, the numbers moved markets.
Yet the seasonally adjusted labour force estimates from the Australian Bureau of Statistics for October sound incredible and they should be treated as just that: not credible.
The Western Australian's economics editor Shane Wright captured the tone nicely when he tweeted: "The ABS chocolate wheel has landed on 5.9 from 6.2."
Don't believe politicians as they gloat and claim credit. Don't believe the wire services when they report the estimates as fact.
There were 44,640 minutes in October and, if you accept the estimate, 58,600 jobs were created.
As the Age's economics editor Peter Martin points out, count only normal business hours, and that equates to 5.5 workers being hired each minute of the working day.
Even the economist known as "Mr Sunshine", Craig James of Commsec, is not buying it.
"It's hard to believe that almost 60,000 jobs were created in one month with 40,000 of these jobs in full-time positions," was his response.
The slamming of the economic propaganda continues:
The ABS is itself cautions against placing too much credence on the monthly figures, which are based on a changing sample, particularly the seasonally adjusted data. The statistician encourages people to focus on the trend estimate (which had the unemployment rate unchanged).
And, after a series of stuff ups, revisions and methodological changes over the past year, there is even more room for caution.
Last year, the ABS was forced to abandon seasonally adjusted labour force numbers for a period after conceding they were unreliable. The former chief statistician recently said the data was not worth the paper it was written on.
Wait, what: confidence boosting data is unreliable? Surely you jest.
And here is the ABC's conclusion confirming at least one "developed" country still have a thinking media: "don't be surprised if the October labour market data is revised."
If only we could say the same about propaganda rags in the United States...
