Unemployment, the states
With Republican governors:
Highest unemployment rate: Georgia, 8.1 percent
Lowest unemployment rate: North Dakota, 2.8 percent
Largest rate increase since April: Georgia, 2.1 points up
Largest rate decrease since April: North Carolina, 1.2 points down
With Democratic governors:
Highest unemployment rate: California, 7.4 percent
Lowest unemployment rate: Vermont, 4.1 percent
Largest rate increase since April: Virginia, 0.7 points up
Largest rate decrease since April: Illinois, 2.5 points down
Source: Bureau of Labor Statistics, staff research
With the unemployment rate in Georgia rising even as new jobs are added, experts have argued about what it means: statistical glitch or sign of economic distress?
A frustrated Gov. Nathan Deal went a bit further last week. He raised the question of whether federal officials might be toying with the data for political reasons. Georgia’s rate rose from 6.9 to 8.1 percent from April to August.
"It's ironic that in a year in which Republican governors are leading some of the states that are making the most progress, that they almost, without exception, are classified as having a bump in their unemployment rates," he said. "Whereas states that are under Democrat governors' control, they are all showing that their unemployment rate has dropped."
In an election year, state economic growth – or lack of it – is a hot topic for Deal and his rival, state Sen. Jason Carter, who has ratcheted up his attacks on the governor’s economic policies.
Deal’s challenge to federal data got traction as his comments were reported on political blogs such as Salon.com and in the New York Times. Once the issue was raised, The Atlanta Journal-Constitution took a look at the credibility of the numbers and the agency.
Among competing explanations for the discrepancy between Georgia adding jobs while jobless rates are up: job growth is too tepid to provide for people moving here; lost housing and manufacturing jobs have not been replaced; the data is too sparse, so unemployment is exaggerated; summer jobless numbers have a pattern of being higher; and hiring has encouraged jobseekers who dropped out to get back into a job search.
Could there be that more sinister option, a Democratic administration ordering number-crunchers to “bump” Republican-led states? Because 18 states – two of them Democrat-led, the rest Republican — did see rises. Most were small.
Taken aback by the question about the agency’s integrity, BLS spokesman Gary Steinberg said the BLS does its work apolitically and consistently. “We have a regular process, and the process was followed all the way from the beginning to the end.”
The BLS has only one political appointee, he said, Commissioner Erica Groshen, a former economist for the Federal Reserve.
Mark Vitner, senior economist for Wells Fargo, was skeptical, but wondered about the idea of the agency lying.
“There used to be a time when I’d say it was preposterous, but everything is so political today,” he said. “I really think it’s economic forces, but I can see where somebody could come to that conclusion. Maybe I’ve watched too many episodes of ‘House of Cards.’”
Other economists reject the notion.
Gary Burtless, senior fellow at the Brookings Institution, said he was puzzled by the unemployment rate’s rise, but not because he doubts the agency’s honesty. “Let me state emphatically that I am extremely skeptical that the BLS data are being cooked to make Red states look bad and Blue states good.”
The BLS has been suspected before of juicing the numbers.
Days before the 2012 election, it released an unexpectedly strong jobs report – news that surely did the incumbent Democratic President Barack Obama no harm. And during the previous administration, Republican president George W. Bush was sometimes accused of tinkering with job reports.
Chad Stone, chief economist for the left-leaning Center on Budget and Policy Priorities, dismissed suspicions. He recalled serving on a joint congressional committee that was briefed each month by the BLS commissioner.
“They would do a lockdown,” he said. “They are really, really, really careful to let nothing out. They are a very professional organization.”
Doubts about the facts are not good for decision-making or democracy, Stone said. “We want to be able to trust the statistics. It is not the statistical agencies that are failing us, it is the political environment.”
On Wednesday, a spokeswoman for Gov. Deal said there was never an intent to impugn the honesty of the statisticians.
“The governor’s underlying point is that Georgia’s unemployment rate doesn’t add up,” said Sasha Dlugolenski. “The fact is, Georgia’s job engine is humming, and you don’t have to take our word for it. We don’t think there’s a conspiracy; we just think the numbers are wrong and we’ve made a strong case for why we think that.”
And while the governor’s office softened last week’s comments, economist Nicholas Eberstadt wanted to make it clear that he depends on the numbers.
Eberstadt, resident scholar at the American Enterprise Institute, a conservative think tank last spring wrote an article sharply critical of the unemployment rate. He called it “an increasingly inaccurate barometer for measuring the health” of today’s labor market, which has changed dramatically.
“I myself do not challenge their integrity or question the integrity of the BLS data,” he said this week. “I don’t think that it is monkeyed with. I don’t think that it is politicized.”
A lot rides on that data’s credibility, he said. “If there were a hint that we couldn’t depend on this data, businesses across the country would just go nuts. It would cause all sorts of anxiety in the financial sector.”
Asking about the integrity of the BLS is “not crazy,” Eberstadt said. “It is healthy to ask whether an organization that handles important information about the economy has the competence and the integrity to handle that data. And I think the answer is: Yeah, they do.”
See U.S. maps of states, political parties and unemployment rates online at http://www.myajc.com/news/governors-unemployment-2014-maps/
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