The fact that there was a rise in employment for May of 2.5 million (a true number) instead of their predicted decline in 7.5 million is extraordinarily telling. It rivals the political “experts” prediction of a Hillary win in November of 2016. Perhaps it is the same people.
I wrote a blog post regarding this estimated prediction during a global pandemic back in April: Blog post here.
Sean Snaith, director of the University of Central Florida’s Institute for Economic Forecasting, said Friday that the national jobs numbers reflect the economy — and state — being “plugged back in.” We had earlier commented that the economy’s demise was the result of workers being told to go home. That it was not the result of months, or maybe even years, of economic demise where banks were involved in egregious behavior or inflation had risen to the extent consumers were forced to cut back.
At the beginning of this crisis, the economy was riding an eight-year high. The only sign economists could point at was the fact the economy was due a downturn. And the fact we have not had a recession is hardly a key variable selection for forecasting.
We need some truth-telling serum to be dispensed to the business and academic economists who are using old school variables to predict tomorrow’s economic activity. The serum would have a healthy component of puzzlement, and a generous pinch of ‘let’s wait and see’. A pandemic decline is unique and should be treated as such.