Matthew O'Brien from The Atlantic:
The economy added 114,000 jobs in September, and added 86,000 more jobs than originally thought in July and August. Unemployment fell 0.3 percentage points to 7.8 percent, even with the labor force growing by 418,000. In other words, it fell because more people were working, not because more people gave up looking for work.
This has some people scratching their heads. How did unemployment decline so much if we only added 114,000 jobs? Well, there are actually two jobs numbers, and the second one showed us adding 873,000 jobs. Confused? Welcome to the wonderful world of the Bureau of Labor Statistics (BLS). Here's how it works. The jobs number and the unemployment number are derived from different sources -- the former from a survey of employers and the latter from a survey of households. Both ask about jobs, but they don't always match up in any given month. The idea is the employer number is better at telling us how many new employees there, but it can't tell us how many people want work but can't find any. That's where the household number comes in -- it polls how many people have new jobs and how many people want jobs.
Math, math, math. It always confuses the right.