Farrar vs the facts

Written By: - Date published: 1:30 pm, November 9th, 2009 - 34 comments
Categories: dpf, economy, employment, unemployment - Tags:

I’ve never quite understood why David Farrar, who is after all paid to do statistical work, insists on performing transparent statistical tricks on his blog.

Yesterday, he did a post with figures on the number of 15-19 year olds with jobs. He argued that it showed removing the youth rate and giving everyone the same minimum wage was the cause of many young people losing their jobs. No evidence was presented for this ideologically based argument other than that the youth rate was (essentially) abolished in March last year and youth employment is down since then.

I wonder what else could have caused lots of young people to lose their jobs… oh yeah, how about the worst recession in 30 plus years?

I took the same data as Farrar used but rather than conveniently starting 1999, I went back to 1990 so we could see what happened in other recessions (and,unlike Farrar, I used the percent with jobs, not the absolute number for obvious reasons). Here’s what I found
youth unemployment
Check out what happened during the recession induced by the neoliberal revolution in the early 90s. Yup, lots of youths lost their jobs. There’s a smaller dip in the Asian Crisis recession too. And now a dramatic drop – not when youth rates were abolished but a year later at the worst of the recession.

Honestly, I don’t know who David thinks he’s fooling.

34 comments on “Farrar vs the facts”

  1. It is not an easy job feeding crap to the hordes of wingnuts to satisfy their prejudices but someone has to do it!

    • Gitmo 1.1

      He he yes but who’s doing the feeding and who are the wingnuts ?

      Guess it depends which direction you’re looking in.

  2. vto 2

    Ha ha, well done. Love to see mr farrar post in explanation / debate…

    • Ari 2.1

      What’s to debate? The right loves to use absolute numbers because it lets them make faulty comparisons, or take credit for inflationary spending.

      David’s just up to old tricks.

  3. Sorry Marty but you’ve been shown up yet again.

    As DPF notes:

    There has been a dramatic decrease in the number of jobs for under 20s, but relatively little for 20 to 24 year olds. From Sep 07 to Sep 09 the number of teenagers in employment fell 32,800 while for those aged 20 24, the fall was just 4,100.

    Hence I think the abolishment of youth wages is a major factor. Otherwise you would expect the two age groups to be somewhat more aligned.

    You’re close to lying by omission as the graph illustrated the point above which you have chosen to omit.

    • vto 3.1

      ha ha, well done. Love to see mr marty post in explanation / debate …

    • Daveo 3.2

      “you would expect the two age groups to be somewhat more aligned.”

      does he say why he expects that? 15-19 year olds have an entirely different employment profile from 20-24 year olds.

      • indiana 3.2.1

        Most 20-24 have completed school and are likely to employable, unless they have a massive student loan and need to live in tertiary education to escape working.

    • Draco T Bastard 3.3

      Your grabbing at straws. No, I wouldn’t expect the two age groups to be more aligned as the two groups aren’t like one another.

      • Daveski 3.3.1

        No evidence was presented for this ideologically based argument other than that the youth rate was (essentially) abolished in March last year and youth employment is down since then.

        Wrong. DPF is arguing that compared to another similar age group there is something happening that is not explained by the data.

        You may disagree with DPF’s interpretation but Marty’s statement is straight out incorrect.

        • Daveo

          Um, they’re different in kind. There’s no need to explain it in the data.

          Just like Maori and Pacific Islanders, youth employment always drops first and hardest in a recession.

          • Daveski

            Happy to agree with that Daveo, my long lost Kiwi cousin. However, there is still a case that the drop for the 15-19 has been greater for other reasons (hint hint).

            In my ponderous and pedantic way, I am actually proving The Baron to be very correct! My only point was that in trying to petty point score, Marty has done exactly what he’s accused DPF of doing.

            Somewhere between the two sets of graphs and pov is an interesting discussion which is still unproven.

        • Draco T Bastard

          Actually, there was – the same thing happened in the last recession. The person not presenting any evidence is DPF.

  4. The Baron 4

    Fascinating stuff – amazing what you can do with statistics huh. Your method looks far more accurate.

    On another note, I personally don’t care for this “pissing match” sorta stuff. You guys seem to be far too interested in following what KB does, and then having a laff with this petty points scoring. It gets a bit dull really (and yeah, the same goes for Whale too).

  5. Conal Tuohy 5

    I’ve never quite understood why David Farrar, who is after all paid to do statistical work, insists on performing transparent statistical tricks on his blog.

    Tricks are work – ask any prostitute.

  6. I’ve never quite understood why David Farrar, who is after all paid to do statistical work, insists on performing transparent statistical tricks on his blog.

    Because he’s a hack who doesn’t care about truth, only spin. next question?

  7. greenfly 7

    ‘Farrar’ing the facts – what’s new?

  8. gomango 8

    I said to myself sometime ago I’d never again respond to one of your posts, but I cant help myself…. You are cherry picking and misrepresenting the other post. Having just read it – what kiwiblog is looking at is the relationship between the two age groups and positing that since the abolition of youth rates the 15 to 19s have fared worse than the 20-24s. You need to look at the correlation and covariance between the two age cohorts – not versus the overall employment rate, and obviously control for compositional changes in the workforce over time. Of course youth unemployment tracks the overall unemployment rate (you showed that, bravo. I can also prove that daylight always follow sunrise) but thats not the question.

    The question is more nuanced – have younger workers done worse than slightly less young workers when you control the data for that. BTW I’m not sure KB adequately answers that either but your article is clearly designed to misrepresent and mislead. Why not dig out the cohort data, compare the percentage employed for each age cohort and see how stable the relationship is? Did that relationship change in March 2008? That would be honest analysis rather than the poorly executed 4th form stats above.

    In economic terms kiwiblog is asking a sensible question: “If an employer has to pay the same wage to either a 16 year old or a 20 year old, which will he tend to choose?

    And do share – are you an economist, a statistician or do you just rely heavily on wikipedia?

  9. George D 9

    It’s also much easier to stay in school or go into training/education than it was 15/20 years ago. We’d expect the number to drop as more defer entering the workforce.

    • Zorr 9.1

      Unemployment refers to those seeking work and being unable to find it. Those choosing to remain in education do not contribute to this statistic.

      • felix 9.1.1

        Actually I think George is correct. The following from “Honest Dave’s” post certainly suggests as much:

        This is a graph of employment of both teenagers and 20 to 24 year olds. It is not seasonally adjusted so every December you see an increase due to holidays.

        That’s why he’s using employment stats, not unemployment stats.

  10. senzafine 10

    FCK has posted another graph. One which this time tracks both unemployment for 20-24 y/o and unemployment for 15-19 y/o since 1990.

    I do believe that this is the most definitive graph on the subject, and also backs up Mr Farrar’s take on things. The spike in 15-19 y/o unemployment we are seeing now is much, much bigger than any spike we have seen in the last 19 years.


    • Marty G 10.1

      It’s the deepest drop because it’s the most serious recession.

      In each recession, the 15-19 employment falls by a greater factor than the 20-24 group, that’s only more true the more serious the recession is.

      FCK gives no evidence that the minimum wage had anything to do with the loss of jobs. The drop does not happen immediately after the law change, it happens once wider employment starts falling.

  11. gomango 11

    How do you define the “worst recession”? GDP drop? Unemployment? If you use the latter the various recessions in the 80s and 90s were clearly worse recessions – compare the peak unemployment rates for instance. Off the top of my head I think we’ve also had worse GDP declines in the past too than 2008-2009. This last recession has had nothing like the impact of earlier recessions – there was significantly more pain and distress (both anecdotal and measured) across many more sectors in previous recessions as opposed to now.

    At least you are now comparing the two cohorts unlike your initial attempt. I haven’t got time to look at the underlying data but my eyeball tells me that there is a significant probability that the relationship between the two cohorts has behaved quite differently over the last short period than it ever has over the previous 20 years.

    You can make glib, politically expedient statements all you like but how about disproving the thesis with actual, like, you know, statistical analysis? .

    • snoozer 11.1

      you define worst recession by looking at the drop in GDP as a % from its peak. This is the worst since proper GDP data has been collected (ie mid 1980s). the late 1970s recession was probably slightly larger

      … oh, that’s what the post is talking about when it says “30 plus years”

      I’m not going to fight Marty’s battles for him but it’s not for him to prove statistically that it’s ‘not true’ that the abolishment of youth rates has anything to do with the drop, some time later, in youth employment. Farrar and FCK are making the argument that the two things are linked – it’s up to them to show some evidence.

      Otherwise Farrar can come up with any old nonsense without proof or evidence and you will automatically believe it unless someone else goes to the effort of disproving it (and you won’t listen to them any way). Oh, wait, that’s what already happens.

  12. gomango 12

    snoozer – looking at the graphs i’m inclined to believe farrar rather than smarty – for the reasons i have outlined So for marty to have a vehement opinion contrary to what my eyeballs are telling me (and glossing over the fact that his first attempt to argue his case was completely unsupportable) I think it is fair to ask for analysis to support his view.

    Actually the whole point of what I am saying is what you are so dismissive of. Look at the numbers. You actually cant have an opinion about statistics, its either true or false at a certain level of significance.

    And thank you for the lesson in GDP economics. You’ve made me go and look up recent history – heres how I’d define the recessions since 1960:

    66/67 -3.7%
    74-77 – 7.3%
    82-83 -3.9%
    87-92 -4.6%
    97-98 -2.3%
    08-09 -4.2%

    87-92 actually had some periods of anaemic growth (from memory I think about 4 periods of either 0 or 0.1% yoy growth) in there but broadly speaking most economists regard the whole period as a recession, but even with that caveat, the current depression is not a huge outlier from all the previous recessions we have had.

  13. snoozer 13

    I don’t get the problem. look at the 1990s recession, you’ve got a similar sized fall in youth employment in a similar sized recession, it’s not as sharp but that was one of the charateristics of this recession, how sharp it was.

  14. gomango 14

    Are you wilfully misinterpreting this whole argumetn or do you genuinely not get it?

    The question is not the relationship between youth unemployment and overall unemployment (or the recession).

    The question is: What is the relationship between employment rates of 15-19 year olds, and 20-24 year olds?

    Get it?

    The next step then to answer is: Has that relationship changed since the abolition of youth rates? The recession/no recession argument is irrelevant. Or at least the analysis should make it irrelevant so we can isolate the effect of the change in youth rate policy to employment rates of the youngest workers.

    Right? Thats nothing even close to the analysis that marty is trying to do.

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