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Nate Silver: Jobs News Makes Obama’s Case Easier
Whenever a new set of jobs numbers is announced, it is important to keep in mind just how noisy the data can be.
Forecasts of the monthly growth in nonfarm payrolls miss by 68,000 jobs on average. That means that the margin of error on the forecasts, enough to cover 95 percent of all possible outcomes, is wider still: plus or minus about 170,000 jobs.
This is not merely because economic forecasting is difficult. It is also because the economy is a hard thing to measure, and the initial estimates of jobs growth are crude. On average, the initial monthly jobs numbers are eventually revised upward or downward by 70,000 jobs.
Nor do the monthly revisions necessarily cancel out. Instead, whole seasons, and indeed whole years, can sometimes be revised.
Forecasts of the monthly growth in nonfarm payrolls miss by 68,000 jobs on average. That means that the margin of error on the forecasts, enough to cover 95 percent of all possible outcomes, is wider still: plus or minus about 170,000 jobs.
This is not merely because economic forecasting is difficult. It is also because the economy is a hard thing to measure, and the initial estimates of jobs growth are crude. On average, the initial monthly jobs numbers are eventually revised upward or downward by 70,000 jobs.
Nor do the monthly revisions necessarily cancel out. Instead, whole seasons, and indeed whole years, can sometimes be revised.
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More:
http://fivethirtyeight.blogs.nytimes.com/2012/10/05/jobs-news-makes-obamas-case-easier/
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