Job Creation Stats

I saw a link to this over at the Marginal Revolution Blog. It's an interesting discussion of the government "job created" statistics by Felix Salmon - and how the stats can be highly misleading - talking about some highly creative accounting:

Yes, for the purposes of this report, the government has calculated the number of jobs created by taking the number of hours worked and dividing by 173. If you pay a man to wield a shovel for one year, working 40 hours a week, then hey, you’ve created 12 jobs! If you pay him overtime, and he works 60 hours a week, then you’ve created 18 jobs! If he keeps on working at that pace for three years, then you’re up to 54 jobs! All from one man earning one paycheck.

Here's the full blog post - very cool reading. I think the post tends to downplay/overlook the multiplier effect of one job creating income that in turn gets spent to create other jobs, but it does seem a bit of a stretch to get to the math above if 1 job created is expected to create 11 others.