September's jobs report from the Bureau of Labor Statistics set off an uproar when it was released, per usual, on the first Friday of the following month. Former GE CEO Jack Welch said that the drop in unemployment, from 8.1 to 7.8 percent, was "unbelievable."
Welch charged "these Chicago guys" - the Obama administration - "will do anything" to boost the president's re-election prospects, including manipulating employment numbers. The thing that had Welch and many other critics in a tizzy had to do with a huge discrepancy in the government-collected data.
According to the BLS's payroll survey, the economy added only 114,000 jobs in September, which is essentially no growth. But its survey of households found many more new jobs reported, almost 900,000. If true, those would be truly extraordinary job gains. But what could explain the huge gap between the two surveys?
The current working theory is, there weren't that many job gains in September. Late reporting by some states caused the agency to lowball unemployment and, hey, flukes happen. In the jobs report for October, released Friday, unemployment was back up to 7.9 and could climb further still.
The message coming from many labor economists is, "These are not the employment droids you were looking for. Move along."
There is, however, one problem in writing off the improved unemployment numbers as a fluke, and it matters on this Election Day. The BLS was not the only entity to find superficially screwy job numbers. The polling organization Gallup also found a big dip in reported unemployment, suddenly down to a reported 7.1 percent.
We non-economists are entitled to wonder just what in the world is going on? Why are all of these jobs popping up in surveys of people but not of businesses? Where do they all go?
We already know that the economy is creating fewer full-time and more part-time jobs to get around the threat of fines for non-compliance with Obamacare mandates. These are not good jobs. They offer awful hours, low pay and usually no benefits.
Many low-skilled workers are responding by taking on work that is off the books and under the table and thus does not show up on payroll surveys. Poring over these employment numbers, it appears quite likely we are witnessing a massive expansion of America's black market.