We really need better ways of measuring economic health. I could lose my six-figure job, turn around, and get hired on as a server at Applebee's for minimum wage, and the "unemployment" rate would stay the same. Not to mention that it doesn't include those not actively looking for work.
Either way, "full employment" doesn't mean much unless you take into account whether people are actually able to live a stable lifestyle or are burning the candle at both ends just to put food on the table. One of these enables folks to buy nonessentials and fund all those sectors of the economy, the other doesn't.
ajmurmann · 5h ago
We have good metrics. The problem is the media seems to only ever look at one of them at a time but we need to look at several at once to get a more complete picture.
Your scenario would be called out by median household income, or better median disposable household income. Even the good old GDP per capita covers your case.
Workforce participation also can be valuable instead of or in addition to unemployment numbers, since you fall out of the count once unemployment benefits expire. However, we need to look at it by age bracket. Lower workforce participation between 20 and 60 is probably bad whereas higher workforce participation over 60 might also be bad.
IMO the problem isn't that the metrics aren't there but that the public discourse either lacks motivation, understanding or incentive to take a proper look. That every discussion of these numbers on social media has a substantial portion of people not understand the difference between median and mean certainly doesn't give me confidence this will ever improve.
Sohcahtoa82 · 4h ago
> Even the good old GDP per capita covers your case.
Absolutely not.
If corporate revenue increases, but wages stay the same, GDP per capita goes up, yet the workers aren't any better off. All that extra money is being absorbed by the ones at the top.
Median disposable household income is probably the best measure.
csallen · 1h ago
Ironically, you're proving the person you're responding to right: The problem is trying to get a holistic view by focusing on one metric in isolation.
You need to consider multiple metrics. Any one metric by itself is going to have holes.
darth_avocado · 4h ago
> Median disposable household income is probably the best measure
If I used to make $78k as a full time IT employee, but now have to work two jobs to make $78k, I still have same household income but I’m considerably worse than before.
A combination of hours worked, wages earned and household debt together would paint a much more accurate picture.
jljljl · 4h ago
This metric of underemployment is captured in U-5 and U-6 in the BLS statistics.
It's less common to report, but in the aftermath of the financial crisis I remember hearing more about it. You can construct a chart in FRED that covers it:
As nerds we possess unique capacity for generating insights via thinkin real hard about stuff, and everyone else is a great big dummy who could not possibly have thought of it already.
darth_avocado · 3h ago
Economists get things wrong all the time. It’s not about others not possibly have thought of it already, it’s about the fact that policy and politics is still driven by other measures that are inaccurate.
Analemma_ · 2h ago
Just because economists get things wrong, does not imply that therefore they can be, and need to be, corrected by computer programmers with superficial understandings of the field. You can both be wrong.
ctoll · 57m ago
This is like arguing that politicians don't need to be corrected by non-politicians, or that people with no understand of programming can't criticize the tech industry.
No one is arguing that being a computer programmer gives a person unique insights here.
> Eschew flamebait. Avoid generic tangents. Omit internet tropes.
hx8 · 4h ago
I'm not sure household debt is a great indicator. Someone that has a mortgage will have much more household debt than a renter, but also not have to pay rent.
This would need data to contextualize.
frontfor · 3h ago
You could argue household debt is just another form of rent, where you “rent” capital from the wealthy in exchange for paying interest on a monthly basis. Just because you don’t pay a rent directly named as such doesn’t change the substance of it.
tshaddox · 59m ago
It's a very different form of rent though, namely because the mortgage borrower has a lot of collateralized debt and the mortgage borrower owns the appreciation (or depreciation) of the property (proportional to their equity).
kevin_thibedeau · 25m ago
A home dweller is paying "rent" to the government as property taxes, possibly indirectly through a mortgage.
ghaff · 1h ago
Debt, within reason, is just a tool. It provides leverage and it lets you buy things for which you don't have cash-in-hand--houses in particular. It can also encourage overspending (something that car dealers capitalize on) but that's another story.
hx8 · 2h ago
Exactly my point. Rent and mortgage debt is functionally very similar and total household debt wouldn't capture rent obligations.
elzbardico · 3h ago
Don't matter. You still have the debt. If you lose your job in a depression, odds are no much other people will be in the market to buy your home.
hx8 · 2h ago
The amount of equity you have in your home matters. Most recessions do not take 20% off home values, so people with conventional loans are pretty safe. Even the Great Depression just cut valuations about 35%.
If you lose your job in a depression there will be plenty of people willing to buy assets at a discount. If you have equity in your home then your position will be net positive. About half of all mortgages have an outstanding balance less than 50% of the home's value.
const_cast · 1h ago
I think debt is good, actually, for most middle class households, and they're actively trying to increase their debt because that results in greater cash-flow, more savings, and more security in terms of retirement. That's why buying a home is Goal #1 for most Americans.
JumpCrisscross · 23m ago
> Median disposable household income is probably the best measure
Median disposable income won’t meaningfully capture OP’s case of losing a high-paying job and having it replaced by a low-paying one. For that you need to look at the distribution of household disposable income.
We have terrific economic metrics in America. It really should be part of a mandatory civics class to learn how to read them.
jltsiren · 3h ago
Household income is a funny collective measure. If housing becomes less affordable, household income increases, as kids stay longer with their parents. And if housing becomes more affordable, household income decreases, as kids move out earlier.
thayne · 20m ago
I think a better measure would be household income divided by number of adults in the household. Possibly with some consideration for the number of children in the household.
shafyy · 4h ago
Even better one: real wages, and income and wealth inequality.
ajmurmann · 20m ago
Why does wealth inequality matter? If my real wealth doubles and Elon's real wealth doubles, inequality went up, yet everyone is tremendously better off. I think we are using inequality as a very bad proxy for poverty but we have much better metrics for that. I suspect people just dislike it for emotional reasons. I want to point out that Sweden has more billionaires per capita than the US. Yet everyone is fine with Sweden.
I can set an argument about political influence that's gotten really strong lately but maybe that's better addressed by strengthening the politically system
jakubadamw · 2h ago
“The Measure of Progress: Counting What Really Matters” is supposedly a good book discussing the inadequacy of GDP as a metric for how well off a society is.
mitthrowaway2 · 1h ago
Perhaps the Gini coefficient would be a better metric to capture this?
ajmurmann · 17m ago
Certainly not in isolation. It measures inequality. If everyone has nothing you get a perfect Gini score. Pakistan, Ukraine, Belarus and Algeria have a lower (better) Gini score than all of the Americas and most of western Europe and Japan. Want to move?
spacemadness · 4h ago
In this episode of how economists lie to us all…
HPsquared · 2h ago
I mean it's basically their job.
BurningFrog · 4h ago
GDP is fairly easy to measure, and since a society normally consumes as much as it produces, it's a pretty good measure of average economic health.
You're right that there is more nuance you'd wish to see, but it's harder to measure, and I don't know how much it's normally worth.
MangoToupe · 3h ago
> it's a pretty good measure of average economic health
Median economic health strikes me as far more interesting than mean. I don't really care how well rich people are doing.
lawlessone · 40m ago
>I don't really care how well rich people are doing.
ahem "people of wealth"
Henchman21 · 2h ago
We all need to be concerned when they’re doing too well
t_mann · 1h ago
I think it's time to switch from GDP per capita to household income. You might think the two are practically the same, and globally that's true, but at the regional level there can be stark discrepancies.
One example: Ireland's GDP grew a staggering 25% in 2015 [0], mainly because Apple decided to book more of their profits there. It does lead to higher tax revenue, but creates relatively few jobs or other income there. The profits go to Apple shareholders, who mainly live outside Ireland. Household income would more adequately reflect where those benefits go than GDP.
Plus, with household income it's more natural to look at the median in addition to the mean, which is the more robust metric, statistically speaking.
I think income is still too crude and misleading. You really need some kind of complex individual economic health measure made of many indicators.
But a more informative proxy would be median net worth - individual, not household, with married couple net worth divided by two for simplicity - as a fairly simple assets vs liabilities calculation.
The net worth distribution would be even more revealing because it would highlight the difference between owners and renters.
This still doesn't reveal net worth stability. In the US you can - and many people do - go from a seven figure net worth to bankruptcy because of a health crisis or (increasingly) a climate disaster.
So you'd want a supplemental distribution showing how variable net worth is, how many people are reduced to bankruptcy at each decile, and how much movement there is in each decile.
Reducing these kinds of complexities to a single number seems misleading at best.
t_mann · 54m ago
As you yourself pointed out, trying to squeeze all aspects of how well people are doing into one metric is tricky - although useful efforts in that direction exist, eg Human Development Index [0]. That's why we're focusing on one specific aspect here, economic activity, for which flow-based metrics like GDP or household income are better suited than stock-based metrics like net worth.
Nobody is incentivized to share bad news about the economy. Everyone has a vested interest in the stock market rising, in keeping their jobs, and a shared desire to see things go up forever.
This is why there needs to be some kind of safety net so that the economy is not a proxy for life and death. In the USA, if you run out of money, you are in real trouble. We need to decouple success/failure in the market from personal safety. You should be able to try opening a hot dog stand, have it tank, and still be able to eat and go to the doctor.
pedroma · 8m ago
>Nobody is incentivized to share bad news about the economy.
Isn't the media incentivized to keep you watching or reading? The common criticism of media is they like to exaggerate a minor issue to get you to click on a headline.
pkaye · 24m ago
> Workforce participation also can be valuable instead of or in addition to unemployment numbers, since you fall out of the count once unemployment benefits expire.
Unemployment rates are calculated based on surveys. They call many people and ask a series of questions to determine which category they fit into.
thayne · 5h ago
> Even the good old GDP per capita covers your case.
Not necessarily. If most of the difference in pay goes to shareholders and/or executives, then the GDP per capita doesn't change. This could be because technology increases productivity, but in a way that increases wealth inequality, and results not only in greater wealth for the already wealthy, but less wealth for workers who are no longer needed.
psunavy03 · 5h ago
> The problem is the media seems to only ever look at one of them at a time but we need to look at several at once to get a more complete picture.
This is what I'm getting at. I recognize there are more detailed measures, but they also never seem to inform the public discourse.
ajmurmann · 5h ago
Not to come off as too cynical but I've increasingly come to the conclusion that the public discourse stays generally at a very shallow level that basic research for 30 minutes quickly moves you beyond. On one hand I find that appalling and poisonous for a democracy. On the other hand, imagine everyone having to spend 30+ minutes on every important topic. It quickly gets out of hand. One could argue that the media should do that research but if they incorporate that in their communication they lose most of their audience who needs to be picked up where they are.
It's why I recently have been convinced that we need something like election my jury
loudmax · 4h ago
> It's why I recently have been convinced that we need something like election my jury
I think this is how the electoral college was intended to function. This is a hard problem to solve, especially when some of the players aren't operating in good faith.
silisili · 4h ago
I agree with the premise here completely, but not what it's in response to necessarily.
Most people keep very shallow knowledge of most subjects, but this doesn't mean things shouldn't be reported. It just means they(media) shouldn't spend a ton of time explaining how said numbers are calculated. Most people read, hear, or otherwise know the current inflation rate, but not exactly how it's calculated.
All that to say, if some metric isn't being reported, there's a reason - likely for some agenda being pushed.
ajmurmann · 3h ago
Are the metrics not reported? Everything I mentioned can be found and it's discussed. Just with more niche audiences or piecemeal
lcnPylGDnU4H9OF · 4h ago
> public discourse stays generally at a very shallow level that basic research for 30 minutes quickly moves you beyond
This is convincingly (to me) explained by the removal of critical thinking courses in public schools, at least in the US. I never experienced them myself but I've heard they included exercises like determining if a statement is fact or opinion, true or false, etc. There was very little of that when I was in school and it was certainly never a dedicated hour-block in high school.
earnestinger · 40m ago
Or more education.
antman · 3h ago
One just needs a couple of hours per important subject with proper mentorship. Then most mews is repeated patterns or red herrings
mathiaspoint · 5h ago
Sortition would help a little but at the end of the day this is why democracy just doesn't work in practice.
ajmurmann · 5h ago
Lol, wut? Any system that's been working better in practice?
There are small outlier countries like Singapore that have extremely well but at scale democratic countries have greatly outperformed other systems
loudmax · 4h ago
There's the problem of scale, and also of duration. Let's say Lee Kuan Yew genuinely wants what's best for Singapore as a whole. How do you ensure that the next autocrat will be equally benign?
ajmurmann · 4h ago
This is the exact issue. There is a lot more variance in autocrats. You can get Lee Kuan Yew and you can get Kaiser Wilhelm. With democracy you are much more likely to get something in the middle. In the end of the day the cost of an bad autocrat is higher than the opportunity cost of a milk toast government compared to Lee Kuan Yew. China is still catching up from the Mao years.
I do work that social media will change this though
triceratops · 3h ago
milquetoast, not milk toast
bena · 2h ago
Both actually. Milquetoast was a fictional character used to characterize extreme timidity, as if he were the personification of milk toast.
Eventually, the name became a synonym for the attitude. But the name comes from the food
triceratops · 1h ago
TIL
Analemma_ · 4h ago
Technically these aren't incompatible: it's possible that democracy doesn't work but nothing else does either— there's no natural law that says there must be a system of political and social organization which actually works in the world we have now. I have been drifting in this direction myself the last few years; it's discouraging, but it seems to be the only conclusion supported by the evidence.
mitthrowaway2 · 1h ago
That's true, but there is a natural law that says that there must be some system of political and social organization that gets employed in practice, so hopefully we can identify the least ineffective one.
mathiaspoint · 4h ago
It works ok in the short term. Note that most democracies (especially the current best performing ones) are extremely young despite the idea being ancient.
You see this on smaller scales as well. Most of people's complaints about "capitalism" are really about the short sighted decisions corporate leadership often make because it has to answer to an anonymous mob of shareholders.
The only thing that actually works is good leadership with long term vision and if anything democracy gets in the way of that.
ajmurmann · 4h ago
The benefit of democracy is that it has somewhat of a self-correcting mechanism build in and it functions without violence. Autocracies don't have that.
You say Democracies have a short track record. While this is true in the grand scheme of things, each individual non-Democracy that came before did as well. Rulers conquered each other's countries, usurped the current leaders etc. quite regularly. I'm not sure I'd count that as stable and longer-lasting.
HPsquared · 2h ago
Autocracies have plenty of self-correction mechanisms. Generally each level is sustained by some kind of grudging consent from the levels above and below.
jacobr1 · 1h ago
Right. Usually there is 100% authority in some kind of dictator. You instead have something that is more like an oligarchy. You have different interest groups with varying levels of influence. In some sense democracy works like this too. Every society has stakeholders that need to be bought off or suppressed and there are various equilibria on how that is done.
kranke155 · 3h ago
It's the incentive. There is a reason the media focuses on easily juiced metrics.
pixl97 · 3h ago
Add in that most media companies these days are a branch of large corporations and it's easy to see where their incentives lie.
mywittyname · 5h ago
> I could lose my six-figure job, turn around, and get hired on as a server at Applebee's for minimum wage, and the "unemployment" rate would stay the same. Not to mention that it doesn't include those not actively looking for work.
This is captured as part of the "U-6" figure for unemployment. The thing is, at a large scale, these events don't matter. They are rare enough to be noise in the grand scheme of things.
The reason the U-3 is the canonical "unemployment rate" is because that is where the core signal is. The bulk of the change in all of the other more inclusive rates is the change in the U-3 scaled by some factor.
But really, your complaint has nothing to do with actual employment, but instead with earnings. Wages are also a metric captured and reported by the BLS and better serve your message.
jordanb · 4h ago
U3 is kinda silly but is mostly used because it is the original employment rate definition and therefore is comparable across time.
U6 would not include the original poster unless his new job was "minimally attached or part-time for economic reasons." U-6 does not, generally, include people who got a new job for lower pay.
MangoToupe · 3h ago
The harm is when people take the metric as literally "what percentage of people who want to be employed can find a job", which U-3 emphatically does not represent.
jacobr1 · 1h ago
It doesn't directly measure it, true. But the parent poster was saying it has extremely high positive correlation to measures that do measure it, so it probably doesn't matter.
wing-_-nuts · 5h ago
>This is captured as part of the "U-6" figure for unemployment.
I always wonder how this is captured. For U-3, you could go with the number getting unemployment benefits. For U-6, you'd have to literally call people and ask them, and I've literally never been called to ask if I'm working in my field and I'd guess most of us haven't either. I have to think if they are sampling, it's a very narrow sample likely biased by geography, industry, age, etc.
jordanb · 4h ago
U-6 mostly comes from the BLS Occupational Employment Survey.
I don't think the original poster would be considered as part of U-6 unless his new job is defined as "marginally attached to the workforce or part-time for economic reasons." Simply getting a job with less pay doesn't put you in U-6.
jandrewrogers · 4h ago
The models are pretty complicated and incorporate several data sources, sampling is just one part of it. I've seen (very dry) documents that go into the methodology in detail. The model does introduce some obvious biases through assumptions of representativeness but how those interact with the headline numbers is not straightforward.
kasey_junk · 5h ago
You of course know that we have a diverse set of metrics for unemployment that capture all of what you are talking about right?
And that is before we talk about alternative signals like the ADP number this like references.
Anytime someone says “we need better ways” you should just read it as “I should do more reading”, because this is a very well studied, understood and measured set of data.
noslenwerdna · 5h ago
This response is a bit less than helpful. Could you provide an example of a metric from this diverse set that fits what the OP is asking for? I feel like there are at least two use cases from their post:
* a metric that measures if people's jobs are paying enough to put food on the table
* a metric that measures whether people's employment matches their education?
Your second query is more subjective. Most people would probably point you at the U6 underemployment number as that’s the most famous one. I like the employment projections series for this kind of question though
https://www.bls.gov/emp/
twoodfin · 3h ago
That real weekly wage data is basically why Trump almost and then did get reelected in one chart.
noslenwerdna · 5h ago
For the second one I was hoping there was something like employment satisfaction, but thank you!
kasey_junk · 4h ago
https://www.bls.gov/nls/ The longitudinal survey asks some job satisfaction questions though I’ve never tried to look for it by education level.
marcosdumay · 5h ago
About the US specifically, your government reports underemployment numbers, as do almost every country report salaries distribution.
quickthrowman · 4h ago
This is all extremely well-known public information gathered and distributed by the Bureau of Labor Statistics, which they compile for free.
Take a look at the St. Louis FRED website and search for wages and wage growth.
Analemma_ · 5h ago
Yes, it's extremely irritating every time people trot out the same copy-pasted complaints about the BLS unemployment rate and how wrong it is, ignoring the fact that the BLS publishes six different unemployment rates, which specifically address most of those complaints. It's a sign of terminal incuriosity and using only superficial and secondhand sources of information like news reports on the unemployment rate, and thinking this is enough to make you qualified to do critique.
tqi · 4h ago
It's also a sign of intense hubris - the idea that thousands of labor economists have never considered something they thought of after 30 seconds of reading means that either a) the economists are all idiots or b) the reader is orders of magnitude smarter than them.
MangoToupe · 3h ago
This is also a sign that communication of the semantics in understandable terms is pretty bad.
Analemma_ · 1h ago
The communications from the BLS are quite good and easily understandable. The problem is that the people making these complaints aren't reading those, they're reading the mainstream reporting on the BLS stats, which is extremely lossily-compressed, and then assuming this makes them qualified to criticize the underlying stats. Journalists deserve some flak here for the superficial way they report on the numbers, but at some point it's on you to get the real thing before you start trying to correct it.
MangoToupe · 1h ago
> but at some point it's on you to get the real thing before you start trying to correct it.
One thing is for sure is that people aren't going to do that.
Anyway, it seems disingenuous (or just completely irrelevant) to complain that people are attacking the BLS rather than how this is wielded to perpetrate a polemic.
yourapostasy · 2h ago
This happens everywhere with lots of people in many different contexts. I call it the “‘why don’t we just’ disease”, or WDWJ Disease. When you’re in any leadership position, you have to stay especially careful to catch yourself from falling prey to this pernicious effect and behavior, and its equally debilitating sibling yak shaving when you over index on preventing WDWJ.
quickthrowman · 4h ago
> It's a sign of terminal incuriosity and using only superficial and secondhand sources of information like news reports on the unemployment rate, and thinking this is enough to make you qualified to do critique.
Agreed, I just dismiss complaints about the unemployment rate unless the poster/speaker mentions/alludes to U1 to U6.
The OP in this comment chain is just ‘old man yells at clouds’ in HN form, complaining about a lack of statistics without checking to see if those statistics are measured (which they are).
jklinger410 · 5h ago
> You of course know that we have a diverse set of metrics for unemployment that capture all of what you are talking about right?
If I could never see another passive aggressive response like this again I would die happy.
deciduously · 5h ago
You of course know that "you of course know _____, right" is the preferred HN rebuttal format, right?
throwawayoldie · 4h ago
Neck and neck with "Got an example of X?"
lovich · 42m ago
Active aggression is looked down upon in this forum
thehoff · 5h ago
The linked article is talking about ADP.
"To be sure, the ADP report has a spotty track record on predicting the subsequent government jobs report, which investors tend to weigh more heavily."
> The government recently disbanded two outside advisory committees that used to consult on the numbers, offering suggestions on ways to improve the reliability of the government data.
> At the same time, Commerce Secretary Howard Lutnick has suggested changing the way the broadest measure of the economy — gross domestic product — is calculated.
> Those moves are raising concerns about whether economic data could be manipulated for political or other purposes.
bilsbie · 4h ago
It sounds silly but we should take it one step further and look at life satisfaction. Who cares about jobs if people are unhappy?
Stay at home parents could be way more valuable than more Wall Street jobs.
jandrewrogers · 3h ago
It is important to note that life satisfaction and happiness are weakly correlated metrics, quite famously so. One is not substitutable for the other. In particular, life satisfaction is correlated with income at all scales whereas happiness is not.
You optimize for one to the detriment of the other. American culture is atypically biased toward the "life satisfaction" side of that tradeoff.
missedthecue · 2h ago
What does that tell us? One person could be unhappy because their boss verbally abuses them every day in team meetings. Another person could be unhappy because their decent and fairly paid job prevents them from playing video games. Finland is once again ranked #1 on the World Happiness Index as the happiest country in the world, yet has a suicide rate much higher than the global rate.
I think the bottom line is that there is no one figure that informs us about all questions. But certain figures have strong correlations. People rag here almost daily about how GDP/Capita is a poor measure of x, y, or z, yet cannot name a low gdp/capita country they'd prefer to have been born in. Because GDP/Capita correlates very precisely with higher standards of living.
BunsanSpace · 1h ago
There's also labour participation and underemployment to look at.
In your case underemployment would go up.
You need to look at all metrics together to get a bigger picture. Example is unemployment is down, but so is labour participation. That doesn't mean there was job growth, it means people stopped looking.
Or if unemployment is down, but underemployment is up. Similar picture emerges.
observationist · 2h ago
A big tech company firing a few thousand current employees and hiring twice as many H1B workers shows a net gain for jobs health, when this represents wages dropping, more people unemployed, and has a very negative impact on the economy. Many big companies game the metrics being Goodharted by regulators and watchdogs, and people guilelessly buy into the headlines, without inspecting the reality underneath.
pkaye · 4h ago
The U6 unemployment rate is supposed to cover those who are underemployed. What is usually reported is the U3 unemployment rate which is closest to that used internationally as defined by ILO.
> We really need better ways of measuring economic health.
What would that look like to you? It seems to me no single, measurable metric is going to tell you economic health. They're a bunch of indicators that need to be interpreted.
onlyrealcuzzo · 5h ago
That's why unemployment is one of many metrics, and we don't put all our weight into a single metric...
fHr · 1h ago
Same with the stock market completly decoupled from the real economy. It's a wealthy index, there could be a real recession and the stock market still would go up.
blitzar · 5h ago
> and the "unemployment" rate would stay the same
Of course it would, the percentage of people unemployed would be the same.
> six-figure job, turn around, and get hired on as a server at Applebee's for minimum wage
Average wages section of the jobs report would reflect this change.
> doesn't include those not actively looking for work
Participation rate section of the jobs report.
> Either way ...
Savings rate, hours worked, consumer credit, default rates etc cover all of this.
thayne · 4h ago
> Average wages section of the jobs report would reflect this change.
Not if someone else at the top got paid more.
jjk166 · 3h ago
If the same amount of wages are getting paid out and its merely getting reallocated as to whom, that's a very different scenario from people getting laid off to reduce labor costs.
Unemployment is meant to track how many people are working, not income equality.
thayne · 36m ago
> that's a very different scenario from people getting laid off to reduce labor costs.
Not necessarily. People could be laid off to reduce labor costs, in order to distribute more wealth to those at the top. And since the average is national, it doesn't even have to be at the same company. People could be laid off from company A, because A is unable to compete with company B that has a smaller head count, but pays their execs more.
> Unemployment is meant to track how many people are working, not income equality.
Sure, but the point is that metrics used to discuss economic health don't typically include metrics that represent wealth inequality, or the standard of living of the general population.
MangoToupe · 3h ago
Perhaps we need better metrics actually tracking income inequality, because tracking employment rate without that seems pretty disingenuous as a metric of aggregate economic health.
Or rather, we should be reporting such metrics that we surely must track already together.
blitzar · 2h ago
This is akin to saying that we need a better metric than CPU temperature to track internet download speed.
MangoToupe · 2h ago
I don't follow at all. Which of these is supposed to correspond to "aggregate economic health"? The problem is that unemployment, particularly U-3, is a bad signal for aggregate economic health by itself. As is GDP. You need an signal for wealth distribution to get a sense of how a given person can interpret to understand how well the economy is serving them. At the very least.
EDIT: Of course, the ultimate issue is people wanting to cherry-pick metrics to push their polemic. If you have any solutions to that I'm all ears. We've been able to articulate an accurate understanding all along, but that doesn't make for easy headlines or simplistic campaign platforms.
kentm · 1h ago
> Which of these is supposed to correspond to "aggregate economic health"?
There's no single metric for aggregate economic health in the same way that there's no single metric for aggregate server health. There's a problem in expectations when people complain about U-3; its not supposed to be a measure of economic health. And thats the point being made here.
MangoToupe · 1h ago
And yet, that's exactly how U-3 is used by everyone but the labor economists that define it. Hence why this conversation is happening in the first place.
kentm · 1h ago
Yes, and the fault is on the people using U-3 that way, not the economists. Talking about the problems with U-3 implies that the economists messed up. The issue is that everyone is looking for a quick 5-second way of making conclusions about a complicated topic.
We don't need a new metric. There is no new metric that will satisfy that criteria. The only solution is to improve the way we talk about the economy.
jjk166 · 2h ago
Is it disingenuous to report obituaries without including birth announcements in the same article? Surely only reporting the one gives a skewed view of demographic health.
News is about reporting new information in a timely manner. When a metric gets updated, it's good to let people know, especially if the new value is unexpected. Many people may have various different uses for this update. It is impossible to give every piece of data anyone could consider useful in a single article. Luckily, that is unnecessary. All that information is publicly available and people can go look it up for themselves at any time.
If you don't care enough to look up the metrics that are reported, that's not a problem with the metrics or the reporting.
MangoToupe · 2h ago
> Is it disingenuous to report obituaries without including birth announcements in the same article? Surely only reporting the one gives a skewed view of demographic health.
The point of obituaries is not to give any sense of demographic health.
> News is about reporting new information in a timely manner. When a metric gets updated, it's good to let people know, especially if the new value is unexpected. Many people may have various different uses for this update. It is impossible to give every piece of data anyone could consider useful in a single article. Luckily, that is unnecessary. All that information is publicly available and people can go look it up for themselves at any time.
Sure, but the issue is that the reporting treats the metric as meaningfully representative of accessibility of employment when it's actually representative of who is seeking the unemployment benefit.
> If you don't care enough to look up the metrics that are reported, that's not a problem with the metrics or the reporting.
This seems wildly naive.
vaidhy · 1h ago
I am a bit confused.. If you are willing to work at Applebee's for minimum wage job, then you are employed. Why should you be considered unemployed?
If you all you can find are the minimum wage jobs and you choose not to work there, then you should be considered unemployed and if you are long term unemployed, U6 captures that.
ajsnigrutin · 53m ago
Politicians can keep lying that the economic situation is great, because the number of unemployed is not rising.
Meanwhile he can't afford rent, even though statistics show everything is ok.
Spooky23 · 1h ago
We know about all of those things and BLS publishes (or at least used to) reliable stats on them.
The unemployment rate as reported is probably the best way to report objectively on employment and the ebb and flow of layoffs and hiring. A more qualitative assessment requires more adjustments and interpretation.
satiated_grue · 5h ago
There are a number of other metrics compiled and reported that answer some of your questions, e.g.:
If every ex-6-figure worker has to work at Applebee's to make ends meet... then who's eating at Applebee's?
virgildotcodes · 1h ago
Applebees drops prices to enable their employees to eat at Applebees. Margins fall, wages universally clamped to minimum wage, layoffs hit. Fewer Applebees workers with lower wages means a shrinking demand side of the Applebees ouroboros, resulting in a spiral of Applebees price cuts, revenue drops, layoffs. The end state of humanity is a desolate Applebees parking lot strewn with desiccated human corpses and the last person alive is the largest shareholder of Applebees, inside the store, consuming their own flesh.
marcosdumay · 5h ago
You seem to want better reporting of economic news. I would say to vote on it with your pocket and pick a better selection of news sources, but I'm not sure those better sources still exist.
Either way, nearly nobody uses the numbers you see on the headlines for any serious decision.
_DeadFred_ · 3h ago
Not at you personally, but your post being top and active, while not really relevant to the story presented always makes me wonder do people upvote these tangents to prevent discussion on the threads original topic?
ipogrjegiorejkf · 3h ago
This is like looking at your revenue numbers and choosing to focus on the number of units sold and disregarding price per unit. The government releases TONS of analysis on wages and wage growth (e.g. the "price per unit"). The St. Louis FRED is a great resource.
I don't blame you. I blame the media for bad reporting. If you dig deeper, I can think of a few reasons why the media would choose to focus on some metrics and not others but I'll leave my conspiracy theories for another discussion.
We do - People employed part time for Economic Reasons.
If what your looking for is 'People with salaries below the highest they've ever earned', then you're just going to get a very noisy metric of sales people on bad commission years, etc.
ivape · 59m ago
Why do we care so much if jobs are created or not created? The market is the market, either we need more jobs or we don't. If there are not enough jobs, then what are we going to do? Create more? We're just dressing up socialism in capitalism's clothes. If you want to seriously do capitalism, then there is absolutely no reason to measure employment. If it's zero then it's correct, if it's 100% then it's correct, the number is always correct.
The problem isn't employment. It's food and shelter. Why do we care so much if people have jobs? Because in America you will die homeless and starve without one. The core issue is much further down Maslow's hierarchy.
The food and housing are too expensive so much so that we are now flabbergasted by the reality of the end game of this system, and we're trying to use euphemistic metrics to broom the larger issue (food and a roof) under the bed. The situation is so bad that a large percentage of Americans are absolutely fine dragging anything that resembles economic competition (immigrants) by their fucking ears off the street, mom dad and child, and dumping them in some random country. The larger US population is unable to cede even an ounce of empathy because their wallets are held hostage by a loan-based society/growth-oriented pricing (my house MUST be worth 40% more since I bought it - really? I see.). We're at an inflection point.
This could be a false analogy, but I'll throw it out there. Imagine a startup that cannot sell their product because it simply sucks. Now imagine not coming to terms with that and doing relentless A/B testing and pointing at the data from that. You won't solve shit with that data, go back to the drawing board.
Infinite growth and infinite "go work more and harder" doesn't sound like the path forward for America. This is very much a "work smarter" situation, because you have to be stupid to keep buying that paradigm. The deal we made with capitalism had nothing to do with annihilating our core conscious of feeding and housing everyone. Capitalism was never supposed to eradicate that human virtue and certainly not add a layer of "must have money and must have job" to stay dry/warm and not hungry, and at the very least not be in constant financial anxiety (which is the day-to-day psychological torment the average American faces).
Another way to interpret employment numbers is to simply meditatively say out loud "There's 70k people this month that are on the rails because this society is that cut-throat about money for literally everything, down to the bagel, down to the roof".
----
Anyway, the new bill congress just passed targeted SNAP, so we definitely cut off more people from affordable food. This entire country is going to need something like SNAP for 300+ million Americans in about 10 years, so we'll all get to watch the poetry of this one.
stego-tech · 5h ago
This has been a critique of the figures for decades, but the current numbers are too convenient for the powers-that-be to change into something more reflective of reality. Trust me, spending fifteen months unemployed in the middle of nowhere and with access to raw data helped me understand a lot about the deliberately engineered shortcomings of our current datasets.
It’s in the vested interest of leaders to control the narrative. That’s why we have/had so many regulations that prevent them from doing so.
jimt1234 · 4h ago
I think it's even worse, because that single metric, unemployment, is highly manipulatable. Administrations have been known to redefine "employment" in order to make the number look more favorable.
analyte123 · 4h ago
The ADP payroll report is noise. It is based on the payroll data from ADP only. The assumption of this report is that companies that use ADP to process their payroll are completely representative of the entire economy and that there is no regional, sector, or company stage bias to their customers. A firm with ADP laying employees off and 3 new firms with the same number of employees being founded and using a different payroll provider would be reported as a "loss" here. Maybe the private sector did lose jobs, but I wouldn't use this report to find out.
chc4 · 4h ago
ADP say that they handle payroll for one in six of all companies in America. That is both a large sample size, and probably broadly representative of the economy. There will of course be some business segments that are over or underrepresented but that is different than disregarding the entire report as noise.
WillPostForFood · 1h ago
ADP reported a meager 29,000 increase in new jobs, but the BLS showed a much larger 139,000 gain. April also showed a similarly wide gap between the two reports.
Through the first five months of 2025, the difference between the two reports has averaged a whopping 63,000 a month.
ADP is predominant in large companies and has little hold in startups. It skews the stats.
hx8 · 4h ago
ADP data does have a bias, but it is so much data it provides a valuable signal. The importance of understanding the source of your data and how it represents the largest population is something every scientist has been drilled on.
weaksauce · 1h ago
two small companies i used to work for used adp.
danaris · 7m ago
...You know that "startup" is not synonymous with "small company", right?
What's the situation in the vast swath of the economy that's made up of small non-startup companies?
shkkmo · 3h ago
> That is both a large sample size,
It doesn't matter how large your sample size is if your sampling method is biased. This could be measuring market share gain/loss in different segments of a steady employment environment.
> disregarding the entire report as noise
Studies with bad / non public sampling methods should be, at a minimum, treated with great skepticism. Why would that not apply here?
chasd00 · 2h ago
> ADP say that they handle payroll for one in six of all companies in America
that's less than 20%. If you had 10 people to interview and interviewed 2 of them i wouldn't say you interviewed a representative sample of the 10.
IshKebab · 2h ago
No, but if I had 1000 people to interview and interviewed 200 of them at random then absolutely yes.
I know right. Statistics.
protonbob · 19m ago
The key is "at random". Businesses are not randomly assigned to use ADP
IshKebab · 15m ago
That's a separate problem. I have no idea what the sampling bias is, but the issue isn't that they "only" sample 20% of the population.
jjk166 · 2h ago
Noise is the absence of a signal. A biased signal is fine, just account for the bias.
ADP is huge and covers a broad range of sectors. It would be a very interesting result (and a very extraordinary claim) if the employment data from non-ADP companies went in the opposite direction of ADP. I certainly see no evidence that firms underrepresented in ADP's data are hiring prodigiously.
csomar · 4h ago
It depends on how randomly representative it is. If it is close to random, then it's better than most poll data.
jeffbee · 4h ago
There have been many instances of ADP and BLS job reports being out of step, which can be expected because of their differing methodologies. On the other hand, nobody with a brain can take BLS surveys at face value under these circumstances.
jimbokun · 5h ago
> But the contraction was capped by payroll expansions in goods-producing roles across industries such as manufacturing and mining. All together, goods-producing positions grew by 32,000 in the month, while payrolls for service roles overall fell by 66,000.
Is this tariffs working as intended?
danans · 5h ago
If your metric is "more/better jobs", then yes tariffs are a failure.
But in a roundabout sense ... yes they are working. At least if the goal is to discipline and squeeze labor, and return leverage to employers.
Part of the goal of the tariffs (and other non-tariff related policies) seems to be to reset leverage at all layers of the labor markets, pushing higher skilled and paid workers into lower skilled and paid manufacturing jobs by increasing the labor availability pool (primarily via workers being unable to get jobs at their previous skill/salary level).
For example, imagine a former software engineer taking a lower paid job as an IT admin at a mining company.
Similarly, cutting Medicaid benefits and adding work requirements could trigger increased availability of the lowest skilled labor, thereby reducing the wages that people doing that labor can demand.
That is all a boost for employers seeking lower cost but high skilled labor, but a knock down for all the workers.
pqtyw · 4m ago
> imagine a former software engineer taking a lower paid job as an IT admin
Is the implication that the software engineer lost his job because of the tariffs? Because all other things being equal (which they are obviously not) tariffs would increase the demand for labor in an non-export driven economy like the US.
> seeking lower cost
Well they certainly aren't supporting increased tariffs if that's what they want.
elcritch · 3h ago
If more goods are made locally then it seems rather that unions would have more leverage. They’re not competing with underpaid foreigners in countries with even less unions.
The bigger loss for all employees is the shareholders primary fallacy giving executives excuses to pay workers less. Since there’s no competition for many consumer goods then there’s no pressure to keep prices low and companies just up their profit margin.
The loss in IT / software jobs are again mostly profiteering using AI as an excuse.
danans · 2h ago
> If more goods are made locally then it seems rather that unions would have more leverage.
Unions represent only 9.9% of US labor [1], primarily in the public sector and the skilled trades. White collar workers and low skill workers tend not to have the benefit of a union.
Tariffs are maybe OK if you are, for example, an domestic auto assembly worker (assuming no job losses due to demand reduction or supply chain cost increases), but otherwise not great.
As a way to shift labour into less productive, lower paying industries? Yes.
giantg2 · 1h ago
I'm about to lose my job too. The job market looks terrible.
hliyan · 5h ago
Important: "[payroll processing firm] ADP's report has a spotty track record on predicting the subsequent government jobs report"
jandrewrogers · 4h ago
ADP and BLS numbers are measuring different things. For people that care about these things, the nuances are well-understood.
As a rough heuristic, ADP overfits to private sector jobs and BLS overfits to government jobs. There is a popular derivative heuristic that the economy is "good" when ADP > BLS.
adrr · 5h ago
Government job reports this year have been revised down up to 35%.
> The change in total nonfarm payroll employment for March was revised down by 65,000, from
+185,000 to +120,000, and the change for April was revised down by 30,000, from +177,000 to
+147,000. With these revisions, employment in March and April combined is 95,000 lower than
previously reported. (Monthly revisions result from additional reports received from
businesses and government agencies since the last published estimates and from the
recalculation of seasonal factors.)
Recent government payroll data has been hugely suspect. On the big release day the numbers are rosy and get reported to much hoopla and "told you" celebration, but then are subsequently revised downwards to little fanfare or notice. And for those who wonder "why revise downward if it's a lie?", because the numbers eventually are going to collide with reality so they need to be right sized after the fact.
k4shm0n3y · 1h ago
This isn't a recent phenomena
quantum_state · 2h ago
When the government is robbing all consumers with tariffs, more bad news will come …
underlipton · 5m ago
The fun part is when it's revised down 60,000 in two months.
Either way, "full employment" doesn't mean much unless you take into account whether people are actually able to live a stable lifestyle or are burning the candle at both ends just to put food on the table. One of these enables folks to buy nonessentials and fund all those sectors of the economy, the other doesn't.
Your scenario would be called out by median household income, or better median disposable household income. Even the good old GDP per capita covers your case.
Workforce participation also can be valuable instead of or in addition to unemployment numbers, since you fall out of the count once unemployment benefits expire. However, we need to look at it by age bracket. Lower workforce participation between 20 and 60 is probably bad whereas higher workforce participation over 60 might also be bad.
IMO the problem isn't that the metrics aren't there but that the public discourse either lacks motivation, understanding or incentive to take a proper look. That every discussion of these numbers on social media has a substantial portion of people not understand the difference between median and mean certainly doesn't give me confidence this will ever improve.
Absolutely not.
If corporate revenue increases, but wages stay the same, GDP per capita goes up, yet the workers aren't any better off. All that extra money is being absorbed by the ones at the top.
Median disposable household income is probably the best measure.
You need to consider multiple metrics. Any one metric by itself is going to have holes.
If I used to make $78k as a full time IT employee, but now have to work two jobs to make $78k, I still have same household income but I’m considerably worse than before.
A combination of hours worked, wages earned and household debt together would paint a much more accurate picture.
It's less common to report, but in the aftermath of the financial crisis I remember hearing more about it. You can construct a chart in FRED that covers it:
https://fred.stlouisfed.org/graph/?g=1JWGw
As nerds we possess unique capacity for generating insights via thinkin real hard about stuff, and everyone else is a great big dummy who could not possibly have thought of it already.
No one is arguing that being a computer programmer gives a person unique insights here.
https://news.ycombinator.com/newsguidelines.html
Notably:
> Be kind. Don't be snarky
> Eschew flamebait. Avoid generic tangents. Omit internet tropes.
This would need data to contextualize.
If you lose your job in a depression there will be plenty of people willing to buy assets at a discount. If you have equity in your home then your position will be net positive. About half of all mortgages have an outstanding balance less than 50% of the home's value.
Median disposable income won’t meaningfully capture OP’s case of losing a high-paying job and having it replaced by a low-paying one. For that you need to look at the distribution of household disposable income.
We have terrific economic metrics in America. It really should be part of a mandatory civics class to learn how to read them.
I can set an argument about political influence that's gotten really strong lately but maybe that's better addressed by strengthening the politically system
You're right that there is more nuance you'd wish to see, but it's harder to measure, and I don't know how much it's normally worth.
Median economic health strikes me as far more interesting than mean. I don't really care how well rich people are doing.
ahem "people of wealth"
One example: Ireland's GDP grew a staggering 25% in 2015 [0], mainly because Apple decided to book more of their profits there. It does lead to higher tax revenue, but creates relatively few jobs or other income there. The profits go to Apple shareholders, who mainly live outside Ireland. Household income would more adequately reflect where those benefits go than GDP.
Plus, with household income it's more natural to look at the median in addition to the mean, which is the more robust metric, statistically speaking.
[0] https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locat...
But a more informative proxy would be median net worth - individual, not household, with married couple net worth divided by two for simplicity - as a fairly simple assets vs liabilities calculation.
The net worth distribution would be even more revealing because it would highlight the difference between owners and renters.
This still doesn't reveal net worth stability. In the US you can - and many people do - go from a seven figure net worth to bankruptcy because of a health crisis or (increasingly) a climate disaster.
So you'd want a supplemental distribution showing how variable net worth is, how many people are reduced to bankruptcy at each decile, and how much movement there is in each decile.
Reducing these kinds of complexities to a single number seems misleading at best.
[0] https://hdr.undp.org/data-center/human-development-index
This is why there needs to be some kind of safety net so that the economy is not a proxy for life and death. In the USA, if you run out of money, you are in real trouble. We need to decouple success/failure in the market from personal safety. You should be able to try opening a hot dog stand, have it tank, and still be able to eat and go to the doctor.
Isn't the media incentivized to keep you watching or reading? The common criticism of media is they like to exaggerate a minor issue to get you to click on a headline.
Unemployment rates are calculated based on surveys. They call many people and ask a series of questions to determine which category they fit into.
Not necessarily. If most of the difference in pay goes to shareholders and/or executives, then the GDP per capita doesn't change. This could be because technology increases productivity, but in a way that increases wealth inequality, and results not only in greater wealth for the already wealthy, but less wealth for workers who are no longer needed.
This is what I'm getting at. I recognize there are more detailed measures, but they also never seem to inform the public discourse.
It's why I recently have been convinced that we need something like election my jury
I think this is how the electoral college was intended to function. This is a hard problem to solve, especially when some of the players aren't operating in good faith.
Most people keep very shallow knowledge of most subjects, but this doesn't mean things shouldn't be reported. It just means they(media) shouldn't spend a ton of time explaining how said numbers are calculated. Most people read, hear, or otherwise know the current inflation rate, but not exactly how it's calculated.
All that to say, if some metric isn't being reported, there's a reason - likely for some agenda being pushed.
This is convincingly (to me) explained by the removal of critical thinking courses in public schools, at least in the US. I never experienced them myself but I've heard they included exercises like determining if a statement is fact or opinion, true or false, etc. There was very little of that when I was in school and it was certainly never a dedicated hour-block in high school.
There are small outlier countries like Singapore that have extremely well but at scale democratic countries have greatly outperformed other systems
I do work that social media will change this though
You see this on smaller scales as well. Most of people's complaints about "capitalism" are really about the short sighted decisions corporate leadership often make because it has to answer to an anonymous mob of shareholders.
The only thing that actually works is good leadership with long term vision and if anything democracy gets in the way of that.
You say Democracies have a short track record. While this is true in the grand scheme of things, each individual non-Democracy that came before did as well. Rulers conquered each other's countries, usurped the current leaders etc. quite regularly. I'm not sure I'd count that as stable and longer-lasting.
This is captured as part of the "U-6" figure for unemployment. The thing is, at a large scale, these events don't matter. They are rare enough to be noise in the grand scheme of things.
The reason the U-3 is the canonical "unemployment rate" is because that is where the core signal is. The bulk of the change in all of the other more inclusive rates is the change in the U-3 scaled by some factor.
But really, your complaint has nothing to do with actual employment, but instead with earnings. Wages are also a metric captured and reported by the BLS and better serve your message.
U6 would not include the original poster unless his new job was "minimally attached or part-time for economic reasons." U-6 does not, generally, include people who got a new job for lower pay.
I always wonder how this is captured. For U-3, you could go with the number getting unemployment benefits. For U-6, you'd have to literally call people and ask them, and I've literally never been called to ask if I'm working in my field and I'd guess most of us haven't either. I have to think if they are sampling, it's a very narrow sample likely biased by geography, industry, age, etc.
I don't think the original poster would be considered as part of U-6 unless his new job is defined as "marginally attached to the workforce or part-time for economic reasons." Simply getting a job with less pay doesn't put you in U-6.
And that is before we talk about alternative signals like the ADP number this like references.
Anytime someone says “we need better ways” you should just read it as “I should do more reading”, because this is a very well studied, understood and measured set of data.
* a metric that measures if people's jobs are paying enough to put food on the table
* a metric that measures whether people's employment matches their education?
Your second query is more subjective. Most people would probably point you at the U6 underemployment number as that’s the most famous one. I like the employment projections series for this kind of question though https://www.bls.gov/emp/
Here are all (6) unemployment measurements that the BLS makes(U1 thru U6): https://www.bls.gov/news.release/empsit.t15.htm
The BLS tracks damn near everything you could ever dream up economically: https://www.bls.gov/
Here you can browse every metric that the Federal Reserve Bank tracks: https://fred.stlouisfed.org/
One thing is for sure is that people aren't going to do that.
Anyway, it seems disingenuous (or just completely irrelevant) to complain that people are attacking the BLS rather than how this is wielded to perpetrate a polemic.
Agreed, I just dismiss complaints about the unemployment rate unless the poster/speaker mentions/alludes to U1 to U6.
The OP in this comment chain is just ‘old man yells at clouds’ in HN form, complaining about a lack of statistics without checking to see if those statistics are measured (which they are).
If I could never see another passive aggressive response like this again I would die happy.
"To be sure, the ADP report has a spotty track record on predicting the subsequent government jobs report, which investors tend to weigh more heavily."
The BLS does do several measures.
https://www.bls.gov/charts/employment-situation/civilian-une...
Their (BLS) news release also provides more detail.
> The government recently disbanded two outside advisory committees that used to consult on the numbers, offering suggestions on ways to improve the reliability of the government data.
> At the same time, Commerce Secretary Howard Lutnick has suggested changing the way the broadest measure of the economy — gross domestic product — is calculated.
> Those moves are raising concerns about whether economic data could be manipulated for political or other purposes.
Stay at home parents could be way more valuable than more Wall Street jobs.
You optimize for one to the detriment of the other. American culture is atypically biased toward the "life satisfaction" side of that tradeoff.
I think the bottom line is that there is no one figure that informs us about all questions. But certain figures have strong correlations. People rag here almost daily about how GDP/Capita is a poor measure of x, y, or z, yet cannot name a low gdp/capita country they'd prefer to have been born in. Because GDP/Capita correlates very precisely with higher standards of living.
In your case underemployment would go up.
You need to look at all metrics together to get a bigger picture. Example is unemployment is down, but so is labour participation. That doesn't mean there was job growth, it means people stopped looking.
Or if unemployment is down, but underemployment is up. Similar picture emerges.
https://fred.stlouisfed.org/series/U6RATE
> We really need better ways of measuring economic health.
What would that look like to you? It seems to me no single, measurable metric is going to tell you economic health. They're a bunch of indicators that need to be interpreted.
Of course it would, the percentage of people unemployed would be the same.
> six-figure job, turn around, and get hired on as a server at Applebee's for minimum wage
Average wages section of the jobs report would reflect this change.
> doesn't include those not actively looking for work
Participation rate section of the jobs report.
> Either way ...
Savings rate, hours worked, consumer credit, default rates etc cover all of this.
Not if someone else at the top got paid more.
Unemployment is meant to track how many people are working, not income equality.
Not necessarily. People could be laid off to reduce labor costs, in order to distribute more wealth to those at the top. And since the average is national, it doesn't even have to be at the same company. People could be laid off from company A, because A is unable to compete with company B that has a smaller head count, but pays their execs more.
> Unemployment is meant to track how many people are working, not income equality.
Sure, but the point is that metrics used to discuss economic health don't typically include metrics that represent wealth inequality, or the standard of living of the general population.
Or rather, we should be reporting such metrics that we surely must track already together.
EDIT: Of course, the ultimate issue is people wanting to cherry-pick metrics to push their polemic. If you have any solutions to that I'm all ears. We've been able to articulate an accurate understanding all along, but that doesn't make for easy headlines or simplistic campaign platforms.
There's no single metric for aggregate economic health in the same way that there's no single metric for aggregate server health. There's a problem in expectations when people complain about U-3; its not supposed to be a measure of economic health. And thats the point being made here.
We don't need a new metric. There is no new metric that will satisfy that criteria. The only solution is to improve the way we talk about the economy.
News is about reporting new information in a timely manner. When a metric gets updated, it's good to let people know, especially if the new value is unexpected. Many people may have various different uses for this update. It is impossible to give every piece of data anyone could consider useful in a single article. Luckily, that is unnecessary. All that information is publicly available and people can go look it up for themselves at any time.
If you don't care enough to look up the metrics that are reported, that's not a problem with the metrics or the reporting.
The point of obituaries is not to give any sense of demographic health.
> News is about reporting new information in a timely manner. When a metric gets updated, it's good to let people know, especially if the new value is unexpected. Many people may have various different uses for this update. It is impossible to give every piece of data anyone could consider useful in a single article. Luckily, that is unnecessary. All that information is publicly available and people can go look it up for themselves at any time.
Sure, but the issue is that the reporting treats the metric as meaningfully representative of accessibility of employment when it's actually representative of who is seeking the unemployment benefit.
> If you don't care enough to look up the metrics that are reported, that's not a problem with the metrics or the reporting.
This seems wildly naive.
If you all you can find are the minimum wage jobs and you choose not to work there, then you should be considered unemployed and if you are long term unemployed, U6 captures that.
Meanwhile he can't afford rent, even though statistics show everything is ok.
The unemployment rate as reported is probably the best way to report objectively on employment and the ebb and flow of layoffs and hiring. A more qualitative assessment requires more adjustments and interpretation.
https://fred.stlouisfed.org/series/CIVPART Labor Force Participation Rate
These are reported by the Bureau of Labor Statistics:
https://www.bls.gov/ces/
Either way, nearly nobody uses the numbers you see on the headlines for any serious decision.
I don't blame you. I blame the media for bad reporting. If you dig deeper, I can think of a few reasons why the media would choose to focus on some metrics and not others but I'll leave my conspiracy theories for another discussion.
We do - People employed part time for Economic Reasons.
If what your looking for is 'People with salaries below the highest they've ever earned', then you're just going to get a very noisy metric of sales people on bad commission years, etc.
The problem isn't employment. It's food and shelter. Why do we care so much if people have jobs? Because in America you will die homeless and starve without one. The core issue is much further down Maslow's hierarchy.
The food and housing are too expensive so much so that we are now flabbergasted by the reality of the end game of this system, and we're trying to use euphemistic metrics to broom the larger issue (food and a roof) under the bed. The situation is so bad that a large percentage of Americans are absolutely fine dragging anything that resembles economic competition (immigrants) by their fucking ears off the street, mom dad and child, and dumping them in some random country. The larger US population is unable to cede even an ounce of empathy because their wallets are held hostage by a loan-based society/growth-oriented pricing (my house MUST be worth 40% more since I bought it - really? I see.). We're at an inflection point.
This could be a false analogy, but I'll throw it out there. Imagine a startup that cannot sell their product because it simply sucks. Now imagine not coming to terms with that and doing relentless A/B testing and pointing at the data from that. You won't solve shit with that data, go back to the drawing board.
Infinite growth and infinite "go work more and harder" doesn't sound like the path forward for America. This is very much a "work smarter" situation, because you have to be stupid to keep buying that paradigm. The deal we made with capitalism had nothing to do with annihilating our core conscious of feeding and housing everyone. Capitalism was never supposed to eradicate that human virtue and certainly not add a layer of "must have money and must have job" to stay dry/warm and not hungry, and at the very least not be in constant financial anxiety (which is the day-to-day psychological torment the average American faces).
Another way to interpret employment numbers is to simply meditatively say out loud "There's 70k people this month that are on the rails because this society is that cut-throat about money for literally everything, down to the bagel, down to the roof".
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Anyway, the new bill congress just passed targeted SNAP, so we definitely cut off more people from affordable food. This entire country is going to need something like SNAP for 300+ million Americans in about 10 years, so we'll all get to watch the poetry of this one.
It’s in the vested interest of leaders to control the narrative. That’s why we have/had so many regulations that prevent them from doing so.
Through the first five months of 2025, the difference between the two reports has averaged a whopping 63,000 a month.
source: https://www.morningstar.com/news/marketwatch/20250702107/be-...
ADP has always been out of sync with BLS numbers. Here is an article in the Atlantic all the way back in 2011 talking about it.
https://www.theatlantic.com/business/archive/2011/05/chart-o...
What's the situation in the vast swath of the economy that's made up of small non-startup companies?
It doesn't matter how large your sample size is if your sampling method is biased. This could be measuring market share gain/loss in different segments of a steady employment environment.
> disregarding the entire report as noise
Studies with bad / non public sampling methods should be, at a minimum, treated with great skepticism. Why would that not apply here?
that's less than 20%. If you had 10 people to interview and interviewed 2 of them i wouldn't say you interviewed a representative sample of the 10.
I know right. Statistics.
ADP is huge and covers a broad range of sectors. It would be a very interesting result (and a very extraordinary claim) if the employment data from non-ADP companies went in the opposite direction of ADP. I certainly see no evidence that firms underrepresented in ADP's data are hiring prodigiously.
Is this tariffs working as intended?
But in a roundabout sense ... yes they are working. At least if the goal is to discipline and squeeze labor, and return leverage to employers.
Part of the goal of the tariffs (and other non-tariff related policies) seems to be to reset leverage at all layers of the labor markets, pushing higher skilled and paid workers into lower skilled and paid manufacturing jobs by increasing the labor availability pool (primarily via workers being unable to get jobs at their previous skill/salary level).
For example, imagine a former software engineer taking a lower paid job as an IT admin at a mining company.
Similarly, cutting Medicaid benefits and adding work requirements could trigger increased availability of the lowest skilled labor, thereby reducing the wages that people doing that labor can demand.
That is all a boost for employers seeking lower cost but high skilled labor, but a knock down for all the workers.
Is the implication that the software engineer lost his job because of the tariffs? Because all other things being equal (which they are obviously not) tariffs would increase the demand for labor in an non-export driven economy like the US.
> seeking lower cost
Well they certainly aren't supporting increased tariffs if that's what they want.
The bigger loss for all employees is the shareholders primary fallacy giving executives excuses to pay workers less. Since there’s no competition for many consumer goods then there’s no pressure to keep prices low and companies just up their profit margin.
The loss in IT / software jobs are again mostly profiteering using AI as an excuse.
Unions represent only 9.9% of US labor [1], primarily in the public sector and the skilled trades. White collar workers and low skill workers tend not to have the benefit of a union.
Tariffs are maybe OK if you are, for example, an domestic auto assembly worker (assuming no job losses due to demand reduction or supply chain cost increases), but otherwise not great.
1. Union Membership (Annual) News Release - 2024 A01 Results https://share.google/dmIydp7foghcJ1Lo2
As a rough heuristic, ADP overfits to private sector jobs and BLS overfits to government jobs. There is a popular derivative heuristic that the economy is "good" when ADP > BLS.
> The change in total nonfarm payroll employment for March was revised down by 65,000, from +185,000 to +120,000, and the change for April was revised down by 30,000, from +177,000 to +147,000. With these revisions, employment in March and April combined is 95,000 lower than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.)
https://www.bls.gov/news.release/empsit.nr0.htm
Not Canadian or EU or South America or SouthEast Asia etc etc jobs.
Is it too early to link that bad economic performance with the catastrophic management style of their current administration?