The Labor Department's establishment survey includes an imputation for jobs created in new firms that are not included in its sampling universe. This imputation tends to miss turning points, understating job growth when the economy picks up speed and overstating job growth when the economy sinks into a recession.
Last year it overstated job growth by 284,000 for the year from March 2006 to March 2007, an average of 24,000 a month. It is likely that this imputation is still overstating job growth. The imputation for April, May, and June was 80,000 more in 2008 than in 2007. Since the economy is almost certainly creating jobs at a slower rate this year than last, it is likely that these numbers will be revised downward in the benchmark revisions. The preliminary data for the benchmark revision will be released with the September unemployment report.
Of course, you can always get the real scoop on the jobs numbers with the CEPR Jobs Byte.
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