Thursday, April 19, 2018

A Spring tradition - Walker Admin reports good jobs numbers that won't hold up

I figured when I saw that the Wisconsin Department of Workforce Development was releasing the Wisconsin jobs report early in the morning that they'd report good numbers. And sure enough, they did.
Place of Residence Data: Wisconsin's preliminary seasonally adjusted unemployment rate for March 2018 maintained its historically low level of 2.9 percent for the second consecutive month and remained 1.2 percent below the national rate of 4.1 percent. Wisconsin also reached a record high for the number of people employed in the state for the third consecutive month. The size of the state's civilian labor force increased to 3,168,500, reaching an all-time high for the second consecutive month. The state's labor force participation rate also increased from February 2018 to March by 0.1 percent to 68.7 percent, while the national rate decreased 0.1 percent to 62.9 percent over the same time period.

Place of Work Data: Based on preliminary data, Wisconsin gained 8,900 private sector jobs over the month and a significant 27,800 private sector jobs and 13,200 manufacturing jobs over the year. Wisconsin also added 6,800 total non-farm jobs over the month and a significant 29,700 total non-farm jobs over the year. Additionally, the state's previously reported loss of 300 private sector jobs from January 2018 to February 2018 was revised upward to a gain of 3,700 private sector jobs, showing a 2 month increase of 12,600 private sector jobs from January 2018 through March 2018.

And I immediately rolled my eyes and shook my head, because I've had about enough of Scott Walker's DWD reporting great job numbers that clearly will not stand the test of time.

The most obvious point to start with is the manufacturing jobs, which were listed in the report as having gone up by another 2,100 last month. If you believe the Walker DWD, the manufacturing sector has gone gangbusters in Wisconsin since last September, adding more jobs in the last 6 months than we had over the previous 5 1/2 years.

Manufacturing job growth, Wisconsin
March 2012- Sept 2017 +13,200
Sept 2017- March 2018 +13,300

Yeah, I don’t think so. And you know why else I don’t think so? Because as UW’s Menzie Chinn reminded us last month, these great Wisconsin job gains in manufacturing have constantly been revised down by the “gold standard” Quarterly Census on Employment and Wages (QCEW).

Guess when the last gold standard report ran through? Yep, Sept 2017, the month before this “manufacturing job boom” began.

But maybe the Walker folks just suck at adjusting for the cold-weather months at the start of the year. If you look at the DWD press releases that came out at an earlier time and then compare them with what we know the numbers to be today, the numbers are often very different. And consistently the "good news" the Walker DWD crows about turns out not to be so good with further review.

Let’s go back to what the Walker DWD was saying 2 years ago for its March 2016 report.
The state added a statistically significant 13,100 private sector jobs from February 2016 to March 2016 on a preliminary basis, including a significant gain of 4,200 jobs in manufacturing.

Wisconsin also added a significant 47,500 private-sector and 51,200 total non-farm jobs over the year ending in March 2016, the best year-over-year growth since August 2004 in both categories. Additionally, revised February private-sector job counts swung from a gain of 8,000 to a gain of 10,500 private sector jobs, a difference of 2,500.
Now compare that big talk to what the numbers became once they were revised to fit the “gold standard”.

Wis job growth
March 2016, all jobs
Walker’s DWD +11,500
Now listed as -900

March 2016, private jobs
Walker’s DWD +13,100
Now listed as 0

March 2015- March 2016, all jobs
Walker’s DWD +51,200
Now listed as +39,700

March 2015- March 2016, private jobs
Walker’s DWD +47,500
Now listed as +40,300

And they were especially off in the first 3 months of 2016 (which I recognized as bullshit at the time).

Wis job growth
Dec 2015-March 2016, all jobs
Walker’s DWD +30,300
Later revision +10,300

Dec 2015- March 2016, private jobs
Walker’s DWD +29,400
Later revision +9,400

In 2017, the DWD’s jobs numbers were also overstated, but were at least in the ballpark of reality (missing by 3,000 overall and 2,200 in the private sector). But the bigger “errors” came with the household survey, which determines the state unemployment rate (and yes, I was skeptical of the "plummeting unemployment rate" at the time).

Household survey, Wisconsin
Dec 2016-March 2017, Labor Force
Walker’s DWD +23,200
Later revision +6,800

Dec 2016- March 2017, Employed
Walker’s DWD +41,800
Later revision +9,400

Those are huge misses, and you’d think a responsible, reality-based administration would adjust their models to figure out how to correct those errors. But this is Walker World we’re talking about, and instead, it seems like they’re learning from past years by inflating numbers in both surveys in 2018.

Dec 2017- March 2018 changes, Wis
Payroll employment
All jobs +20,600
Private jobs +19,700

Household survey
Labor Force +10,200
Employment +20,700

I’ll eat my hat of that stands up to the “gold standard” in September. But by then you can bet the Walker Campaign Administration will come up with some other rosy jobs figure or photo op to try to con the people of Wisconsin that these trickle-down schemes are leading to prosperity.

The real question I have at this point is “What's bad at DWD? Is it their data, or is it their motives?” Yes, I know that's a strong charge, but using taxpayer dollars to spread propaganda to try to help a flailing, losing Walker campaign would be right in line with the SOP for this crew.


  1. The other comparison to check is job growth in surrounding states to see what the stats really look like. MN reported recent monthly gains of around 3000 per month the last few months which is down a bit from last year. The numbers they use still tend to be revised up or down but seem to be off considerably less compared to the WI numbers both at the state and federal level. They apparently must use different data measures to compile the info. It's unfortunate the state would get job seekers hopes up only to crush them when they can't find work or are forced to choose a lower end job out of desperation.

    The car sales comment earlier about broken axles from potholes pushing up vehicle sales up last month was priceless. I say we start compiling a list of other businesses that stand to benefit from poor road quality misfortune! Maybe we just figured out the secret WI job growth plan...big gains in jobs at funeral homes, chiropractic services, medical appointments,pain prescriptions, auto body and glass repair, accident attorneys, cremation, property and car insurance claims! Think of all the possible job growth from bad roads! Sometimes politicians are more sneaky than we think!! We better keep an eye out from an ultra conservative author to see if we are right..."jobs in car repair, insurance, end of life, and medical push state job gains over the top(although most legitimate sectors actually ended the year down or were overstated by 30k)! unfortunately the politically motivated economic "feel good" articles make the UW team do all the digging for the actual truth,but by then, all the media hype is gone and most people out there don't want to hear the truth, because it is fairly depressing to think about!!

  2. Also, if job growth were really this strong, where are the financial numbers to back up that data. The state would likely have a large surplus with through the roof sales numbers and local tax money would be streaming in like crazy, but it seems like none of that has been happening recently. If MN is growing at 3k jobs a month and still shows a $325 billion surplus, WI would easily have more coming in with these numbers even if they took less taxes in.

    And where exactly would all these new workers be coming from when both States have such low unemployment figures? I personally think there is more supply of labor especially if workers take multiple jobs or are currently underemployed, but the numbers they are suggesting are very large and don't seem reasonable during the winter months no less! With IL losing people fast, the Chicago market probably doesn't have all that much to spare in all honesty, and an updated report said WI holds on to much of it's talent quite well but struggles to attract from elsewhere and with an increasingly aging workforce in the state, there definitely seems to be a big error in compiling these numbers somewhere.

    1. I agree that if jobs were really being added as much as the DWD says it is, then we'd be seeing better revenues and some population growth. But that's not happening, which is another reason to be skeptical of these figures.

    2. I was looking at the DWD site for job loss totals and Bon Ton's closure in Wisconsin will by far be the largest job loss in the state in recent memory eliminating 2,255 jobs not including a fewstores that closed earlier thus year and occur at the same time Toys and Babies R US occur affecting another 326 and just weeks before the JCPenny distribution center starts closing.

      The real question is how many other jobs might be lost from other companies especially in Milwaukee that supported Bon Ton corporate employees as the city had loaned nearly two million to Bon Ton's corporate office renovations which have now been halted. The situation is made more dire by the fact that the region has already been struggling with population and job growth compared to other areas.
      It appears job losses have been increasing in number across the state over the last year around the time Gordy's Farm market announced 1008 job losses. Retail has been getting hit particularly hard this year already.

      Imagine the number of jobs that could have saved by using the fox con funds to save existing WI companies that were in dire need of help. Instead, job losses continue to mount while the Fox Con jobs have been slow to materialize and continue to add up unexpected costs the state can't afford. Essentially the state pays more and more for an out of state company while the casualties of home grown companies pile up quickly.