Friday, December 5 2008

The problem with absolute numbers and crisis journalism

I just read this headline “Us Job Losses Worst since 1974“. Knowing that unemployment in the States is still way below the high of 11% in 1981 I checked the article and I see that the journalist chose to measure losses in absolute numbers and then compare. But the overall number of people employed has grown so much since 1974 that absolute numbers are confusing. I find this type of use of statistics misleading. I see it frequently in US journalism lately. Let´s remember that mass psychology plays a big role in recessions. Why push things?

Posted on Micro   |   8:45 pm   |   Trackbacks Trackbacks(1)  

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  1. From Week-Log.295 | Denken Über - December 13, 2008 4:12 pm - #

    [...] Martin y una entrada interesante [...]

Comments

  1. Posted by yaelg - December 5, 2008 10:22 pm - #

    Because “disaster titles” sell !!!

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  2. Posted by Mike Sax - December 5, 2008 10:50 pm - #

    Hi Martin, I agree that the journalist’s argument is flawed, but comparing percentages is not entirely accurate either: Especially in the US, today many people are no longer counted as unemployed because they have part-time work (even when they want full-time work).

    According to economist Robert Reich, the typical workweek in the US has dropped to 33.5 hours – that’s worse than France! :)

    In comparing unemployment rates between periods, it’s probably more accurate to compare level of employment (in hours) rather than unemployment.

    Check this out:

    http://robertreich.blogspot.com/2008/12/shall-we-call-it-depression-now.html

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  3. Posted by Elliott - December 6, 2008 8:30 pm - #

    Caveat emptor with regard to statistics. Mark Twain said & I have often quoted: “Figures don’t lie; liars figure.” If it is a good quip it ussually was said first by Mark Twain. If it is an invention, it was probably done first by Thomas Edison [1,093 US Patemts]

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