Bankruptcies and the Birth/Death Adjustment

When generating employment numbers, the Bureau of Labor Statistics (BLS)uses something called a Birth/Death adjustment, which is supposed to account for small new businesses that it misses in its surveys.

Well, the always quotable Barry Ritholtz has a question, is anyone at the BLS looking at the “death” part of the model?

Specifically, commercial bankruptcies are up 45%, but the BLS is still using their Birth/Death model to increase employment numbers.

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