Trick or Treat? Unemployment Has Dropped Sharply in October, Says Gallup

By Terence P. Jeffrey | October 19, 2011 | 11:11 AM EDT

Halloween masks on display. (AP Photo/Seth Perlman)

( - The non-seasonally adjusted unemployment rate as measured by Gallup has dropped significantly in the first half of October, according to a report released by the polling company--which cautions that the decrease might be partly attributable to Halloween-related and early holiday-season hiring by retailers.

At the end of August, Gallup said unemployment was at 9.2 percent nationwide. At the end of September, Gallup said unemployment was at 8.7 percent. Now, Gallup says the unemployment rate has dropped to 8.3 percent.

Gallup determined the unemployment rate by interviewing a random sample of 18,578 Americans aged 18 or older between Sept. 15 and Oct. 16.

Gallup’s unemployment survey differs from the survey done by the federal Bureau of Labor Statistics (BLS). The BLS surveys people 16 or older, compared to Gallup’s survey of people 18 or older. The federal government also surveys 60,000 people. Additionally, the BLS makes a “seasonal adjustment” to its unemployment statistics to account for seasonal variations in the workforce.

In its analysis of its unemployment survey, Gallup said that the decline in unemployment may be “partly” seasonal.

“The sharp drop in Gallup's unemployment and underemployment rates may partly result from seasonal factors,” said Gallup. “Halloween has become the third-largest sales season for many retailers, who are likely increasing their staffing accordingly. In addition, some stores may have been minimally staffed and are beginning early to add employees for the holidays.”

Gallup also said the drop could be an “aberration.”

“Of course, the precipitous and counterintuitive nature of this sharp improvement in the U.S. job market, as measured by Gallup over the past couple of weeks, means it could be something of an aberration that will dissipate during the weeks ahead,” said Gallup.

Nonetheless, the polling firm pointed out that unemployment is down from a 10 percent national rate a year ago, and that Gallup’s current survey could mean that the unemployment rate reported by the BLS for October will end up being less than 9.0 percent.

“A year ago, Gallup's U.S. unemployment rate stood at 10.0%,” said Gallup. “While seasonal hiring patterns may explain some of this improvement, the drop suggests the government could report an October unemployment rate of less than 9.0%.”

According to the BLS, the unemployment rate was 9.1 percent in September and has not been below 9.0 percent since March, when it was 8.8 percent.

The last time the BLS said that unemployment was as low as the 8.3 percent that Gallup says it is now was in February 2009, when BLS said the unemployment rate was 8.2 percent. That was the first full month of President Barack Obama’s term in office.