The Jobs Number Is BS Says Former Head Of BLS

zero hedge | by Tyler Durden  /  14h  //  keep unread  //  preview The Jobs Number Is BS Says Former Head Of BLS +TAG After every non-farm payroll report we provide our own breakdown of what the real unemployment rate is in a country in which the labor force participation rate has not been adjusted to normalize for the Second Great Depression. In the most recent such endeavor we found the "Real Unemployment Rate" to be 11.3%. To wit: As of May, assuming realistic LFP assumptions, the real U-3 unemployment rate should have been not 7.6% but 11.3%. Today, courtesy of the Post's John Crudele we find that our estimate was spot on not just from anyone, but the former head of the BLS himself: Keith Hall. Keith Hall believes the US economy is a lot sicker than the 7.6 percent unemployment rate would lead you to believe. And he should know. Hall was, from 2008 until last year, the guy in charge of Washington’s Bureau of Labor Statistics, the agency that compiles that rate. “Right now [it’s] misleadingly low,” says Hall, who believes a truer reading of those now wanting a job but without one to be more than 10 percent. The fly in the ointment is the BLS employment-to-population ratio, which is currently at 58.7 percent. “It’s lower than it was when the recession ended. I think that’s a remarkable statistic,” says Hall, a senior research fellow at the Mercatus Center at George Mason University in Fairfax, Va. That level tells Hall the real unemployment rate is actually about 3 percentage points higher than the BLS number. If the jobless rate is unacceptable at 7.6 percent, it’d be shockingly bad if he is right and the true rate is 10.6 percent. ... Hall reckons there are millions of U-6 people on top of the 4.5 million long-term unemployed.  "This has been a very slow, very bad recovery,” he says. “And I think the numbers have really struggled as a result. In fact, I’ve been very disappointed in the coverage of the numbers." It is not just the artificial manipulation in the labor force participation rate, which we first brought up in 2010 and only became a mainstream theme this past year. There is also the monthly seasonal adjustment factor which provides the much needed smoothing function whose only job is to provide a "credible" number to be used by the HFT algos to ramp stock momentum almost exclusively to the upside: after all the only thing the Fed has left is to promote confidence in the economy using the only transmission mechanism subject to the Fed's central-planning: the manipulated monetary policy vehicle known as the S&P500. There are other problems with numbers coming out of BLS, according to Hall. And they will just add to the confusion. All parts of Washington’s data-collecting machine adjust to smooth out the bumps caused by the seasons of the year. But the recession that started five years ago was so severe and the recovery so anemic that the seasonal adjustments have been thrown off. Crudele, a long-time skeptic of manipulated data, points out some other obvious divergences between the Fed's propaganda and reality: The Fed, and particularly Chairman Ben Bernanke, are acting rather strange these days. One minute Bernanke is suggesting that his highly controversial and very dangerous money-printing operation, called quantitative easing, will be tapered off in the near future because the economy is doing better. The next minute Bernanke is talking about how QE will continue if the economy isn’t strong enough to stand on its own. The Fed chief often points to the housing and the stock markets as evidence of economic improvement, although those are nonsense indicators. The stock market is only rising because Bernanke is printing so much money. And housing is improving, with prices rising sharply in spots, because big-time investors who can’t find anywhere else to park their assets profitably are scooping up big-city real estate by the bundle. Finally, while Hall isn't a whistleblower in the pure sense of the word, and hasn't disclosed any specific illegal data manipulation by the BLS, the fact that such systematic data "massaging" has been acknowledged by the former head of the statistical agency should be enough for the BLS and the Obama administration to hang their heads in shame. Of course, they won't - to a big part because nobody in the mainstream media will actually call them out on it - and will instead point to the S&P hitting all time manipulated high after all time manipulated high as proof the economy is doing great. Alas, to their chagrin, nobody believes that particular lie anymore.