Here Comes The Job Shock: Philadelphia Fed Admits US Jobs "Overstated" By At Least 1.1 Million

Regular readers are well aware that back in July, Zero Hedge first (long before it became a running theme among so-called "macro experts") pointed out that a gaping 1+ million job differential had opened up between the closely-watched and market-impacting, if easily gamed and manipulated, Establishment Survey and the far more accurate if volatile, Household Survey - the two core components of the monthly non-farm payrolls report.

We first described this divergence in early July, when looking at the June payrolls data, we found that the gap between the Housing and Establishment Surveys had blown out to 1.5 million starting in March when "something snapped." We described this in "Something Snaps In The US Labor Market: Full, Part-Time Workers Plunge As Multiple Jobholders Soar."

Since then the difference only got worse, and culminated earlier this month when the gap between the Establishment and Household surveys for the November dataset nearly doubled to a whopping 2.7 million jobs, a bifurcation which we described in "Something Is Rigged: Unexplained, Record 2.7 Million Jobs Gap Emerges In Broken Payrolls Report."

Whether this divergence was due to wrong seasonal adjustments (a remnant of the overreaction taken by the Dept of Labor following the covid crunch to normalize for a new normal labor market), due to erroneous Birth-Death assumptions (here too, the Dept of Labor was assuming early cycle new business creation which clearly is wrong with the economy late cycle and millions of businesses shutting down, ignoring the open PPP fraud that took place in early/mid-2000s as everyone "opened up" businesses to get free money from the government), due to the Establishment Survey inability to tell the difference between full, part and multiple-jobs - as a reminder we first showed that since March, the US had lost 400K full-time jobs offset by far lower paying part-time jobs as well as double-counted multiple jobholders...

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