Tuesday, July 11, 2006

Look up, look down, all around...

Oh how the power of a headline can influence the way one thinks about an article. In journalism terms it may be thought of as spin, but you can interpret this as you would like...

Mind you, this is all reporting on the same published report:

From the New York Times, "Jobs Date Indicates Economy is Slowing"...OK, well that would suggest that things are bad, right? Not necessarily: click here

From the Washington Post, "U.S. Payrolls Up Slightly; Jobless Rate Still 4.6%"...OK, well that would suggest that the amount of people with jobs is the same, but they're making more money? Not necessarily: click here

From BBC News (sent in by a loyal reader of our blog, Jessica Goldings), "U.S. Jobs Growth Mild As Wages Rise"...OK, so now there are more jobs AND higher wages? Not necessarily: click here

Three factors that should be taken into account here:
  1. The reason these results are viewed as "bad" are because Wall Street economists predicted higher results. This is coupled with the fact that consumer prices (especially gas prices) are rising. This sent the stock market down and raised fears of inflation. In fact, the Fed had predicted that job growth would not be as large as predicted.
  2. Average wages rose to $16.80/hour which added to the best wage growth in 5 years (which, for those math challeneged, is pre-9/11 numbers)
  3. There should be more workers in June due to seasonal workers, students finding employement/internships during school breaks, and recent graduates entering the workforce. This would, in theory, lower wages due to more workers in the workforce, so a rise in wages should be seen as a positive in this light.
Another lesson to not always believe what the headlines tell you...

If you find good articles you would like to submit for use on our blog, please send them to askatz@astronsolutions.com

1 comment:

  1. reading all 3 of the articles really confused me at first, since they seem to be saying contradictory things (or at least by their headline...) but the 3 factors listed below helped clear up a lot. thanks for your help!


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