Can someone explain the birth-death adjustment in relation to the latest jobs report?

[NickB79]

I've seen that phrase used a few times to claim the current increase in job numbers are nowhere near as significant as they appear to be. Just two questions: what the hell is it, and why do they use it? And please put it in layman's terms; I have a biochem degree, not an economics degree. Thanks!

[RagAss]

1. Yeh...all of a sudden this new measurement....! Republifucks pulled this one out of the ass.

[ipaint]

3. No they didn't. nt

[ipaint]

2. Here is how I understand it.

"That model adds in jobs assumed to have been created by employers who are too new to have been added to the survey, and subtracts jobs from employers assumed to have failed and therefore not responded to the bureau’s survey."

http://globaleconomicanalysis.blogspot.com/2009/11/reader-emails-on-birthdeath-model-and.html

They missed 825,000 unemployed they thought had jobs last year.

[NickB79]

4. Thank you. So, how long has this model been used?

Since it doesn't appear to have the greatest track record, why do they keep using it?

[ipaint]

6. 1999 and who knows.

It doesn't mean that none of the 188,000 jobs were added it's just there is no idea of exactly how many. Could be a lot could be a little.

[Oregone]

5. So if a new business is started, it just automatically adds jobs?

How many per new business?

This seems silly to do...its just guessing. Can't they wait a month and get a real number?