Brewed Fresh Daily

The problem with statistics like this is what they don't show. They don't do a good job of picking up the self-employed, the consultants, the freelancers, the startups and other small businesses. They give a somewhat understated view of the employment/business picture. For instance, I have no doubt that I would be an unemployed statistic according to this kind of chart. Yet I am a business owner. I have no desire for a "job." A job doesn't jive with my view of myself as a free agent. And I suspect that is much the same way that many readers of BFD feel about themselves -- many of you are yourselves free agents. And I am not talking about election year politics and attempts to sway jobs figures to suit one political party or another. That's just political noise. The real story is the "smalling" of American business. It is a fundamental change in the U.S. economy that has been gradually building for years. Traditional jobs statistics aren't exact enough to pick up all the nuances about how people earn their livelihoods in the 21st century USA.

Anita's point is the heart of the (currently quite politicized) argument between economists who prefer the BLS "establishment survey" statistics -- gathered by surveying a very large sample of employers -- and those who like the Census Bureau's monthly "household survey", which asks a much smaller sample of individuals about their employment status. The "household survey" is currently showing better job growth than the establishment survey, which might be because it catches more startups and self-employed people (or maybe not). Economists who prefer to rely on the establishment survey seem to be in the majority, and include not just Dems but also Alan Greenspan... but there are obviously arguments on both sides, and I agree with Anita that the "smalling" of firms and churning of positions raises important questions about the survey approach. Just for the record, here's one defense of the establishment survey as a prime source of national job numbers. As a non-economist I'd just add two things: 1) The government doesn't break the household survey numbers down to the local level because the sample's too small, so it's useless as a marker of Cleveland area employment; and 2) While the BLS establishment survey includes as "employed" only people who are reported as receiving income, I know a lot of folks who might well tell the Census they're "self-employed" or "business owners", but who aren't making a nickel.