Here is what I know with absolute certainty about tomorrow’s employment report for April: the Labor Department will add a large number of jobs to its count despite the fact that these positions probably don’t really exist.
So, there is a pretty decent chance that this statistical optimism — even though it runs contrary to everything we know about the job market in the real world — could make the April employment figure look better than what’s expected.
Let me get right to the details.
In its last report, the government claimed 216,000 jobs were created in March. But to reach that figure the Labor Department added a large number of phantom jobs — 117,000 to be exact — that it believes, but can’t prove, were created by newly formed companies that are too invisible for Washington to survey.
This month the number of these phantom jobs, which are derived from something called the birth/death model, will be even greater than in March. In fact, the Labor Department is likely to add upwards of 150,000 illusory positions to tomorrow’s count.
With the economy clearly slowing over the past few months, Wall Street isn’t expecting much. In fact, the consensus among the “experts” is that only 175,000 jobs were created in April. And that guess has probably come down since ADP, a private employment-monitoring service, yesterday reported total jobs for April that were below expectations.
So, with the addition of 150,000 or so phantom jobs from the government, it might not be hard for April’s number to top 175,000.
There are two ways tomorrow’s report could be troublesome. And there’s just about no way for it to be helpful, except to politicians who will foolishly strut around in praise of an unexpectedly good number.
If job growth in April exceeds the 175,000 guess, the financial markets won’t be examining the cause very closely. So there will be an automatic increase in pressure on the Federal Reserve to raise interest rates. (This is going to be theme of the next two employment reports, as well.)
What if job growth comes in at 175,000 — or below?
If tomorrow’s headline number is weaker than expected, then even a heavy dose of phantom jobs wasn’t able to make the job market look good. And that will be very bad news both for the stat-watchers, as well as the job hunters.
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Since I’m discussing Yankees tickets (which I did in my last column; sorry if you missed it and don’t know what I’m talking about), it really isn’t that expensive to bring your family out to the ol’ ballgame.
You just need to know how to cut corners.
For instance, tickets for the Yanks at the stadium when they play the Kansas City Royals next week are going for as little as $4 on StubHub. And I’ve seen tickets for previous games at $2.
The seats are in the upper deck and they usually sell for $22 plus fees but, heck, you’re watching the same game as the big shots who pay hundreds for a single ticket.
And it’s not just the KC games.
Seats for Toronto later this month and future games are also selling dirt-cheap in the secondary market. And people I know say you can buy tickets for as little as $5 at the Yankee Stadium box office the day of the game.
Still too pricey for your wallet? (Or maybe you’d rather spend your dough on gas and rent.)
Well, the Yanks generously (and inexplicably) allow fans to bring their own food, snacks and unopened bottles of soft drinks into the stadium. You can get soda and water on the street outside the stadium for a buck versus $6 inside.
Check the rules, because I’m not sure full turkey dinners are allowed.
Don’t like the Yanks? Well, there are Mets tickets going for similar discounts, although surprisingly — considering the team’s record — not as many. I believe the rules on outside food and drink differ at Shea — er, CitiField — so you might need to bury your subs deep inside a pocketbook when entering.
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Every journalist wants a piece of this Osama bin Laden story, and I’m no different.
So I’m going to pick on CNBC’s coverage of bin Laden’s death. One commentator on the business channel said on Monday that bin Laden’s demise would be good for investors because it would strengthen faith in the US and lead to more consumer confidence.
Yep, someone made up that lame rationale right there on the air.
So, following the dots, the death of bin Laden is sup posed to cause consum ers to spend more, which will help the economy and thus will make stocks more and more valuable (which, of course, is CNBC’s well- honed and constant theme.)
Well, let me break the news to CNBC.
Consumer confidence will rise when businesses start creating lots of real jobs. And people will spend money when they have it to spend — likely months after these new jobs start surfacing.
I’m as happy as anyone that bin Laden caught one above the eye. And I hope it hurt really badly. But let’s not start imagining unreasonable benefits from his death.
