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Home Publications Blogs Beat the Press Misleading Claims on the Keystone Pipeline: Brought to You By Our Friends at Washington Post

Misleading Claims on the Keystone Pipeline: Brought to You By Our Friends at Washington Post

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Sunday, 18 December 2011 09:57

News outlets reserve the option to factcheck ads and will generally refuse to run an ad that is clearly false. This is apparently not the practice at the Washington Post (a.k.a "Fox on 15th Street).

The paper had a full page ad in the Sunday edition pushing the Keystone Pipeline. One of the claims in the add is that the unemployment rate among construction workers is 20 percent. If the Post had made the long trip over to the Bureau of Labor Statistics (BLS) website it would have discovered that the November employment report showed the unemployment rate among construction workers to be 13.1 percent. That is considerably higher than the national average of 8.6 percent, but still quite a bit short of 20 percent.

It is also worth noting some of the other misleading statements in the ad. It refers to 20,000 jobs that will be "directly" created by construction of the pipeline. Most of these jobs are not in the construction industry, but rather jobs along the supply line, for example in pipeline manufacturers or for truck drivers. While the economy can use these jobs as well, if we're looking at employing construction workers, the 20,000 figure is the wrong number. Direct employment in construction of the pipeline will be less than half of this number.

Finally, it is worth putting this figure in some context. BLS tells us that there were 1.1 million unemployed construction workers in November. If we assume (generously) that half of the 20,000 jobs mentioned in the ad are in construction, then the pipeline would reduce unemployment among construction workers by less than 1 percent. Note that this is 1 percent, not 1 percentage point. Assuming that the industry's numbers are accurate, construction of the pipeline would create enough jobs to reduce unemployment in the construction industry by approximately 0.1 percentage points. 

Comments (12)Add Comment
...
written by Jim Forrester, December 18, 2011 1:27
Your numbers are on the mark and only idiots and liars dispute them.

I would like to see some comment on all the reporting claiming Keystone catching President Obama on the horns of an environmentalists vs. labor dilemma.

Labor is only going to really care if those 10k jobs are union jobs. On a three year construction timeline 10k skilled trades jobs would produce $15,000,000 or more in dues; more than enough to buy a congressman or three or a senator in addition to padding union office salaries or creating more staff.

So are there going to be that many union jobs? If not organized labor is not likely to much care. Does anyone out there have any solid information they do?
...
written by joe, December 18, 2011 2:12
This pipeline must be nothing more than a Koch Bros pork project. It will have no impact on employment or gasoline prices.
Won't create any jobs
written by mcdruid, December 18, 2011 2:40
Ridiculous discussion. All good Republicans know that government spending doesn't create jobs.
You are just as bad as the WAPO....
written by Jay, December 18, 2011 5:25
Nowhere do you mention that your unemployment rate is not seasonally adjusted. Anyone that goes to www.bls.gov and retrieves the series below will realize the SA unemployment rate for November will always be higher than the NSA figure.

LNU04032224
...
written by DrJim, December 18, 2011 10:20
I'm a pretty liberal guy, but I'm not crazy about your post. 20,000 jobs is 20,000 jobs and nothing to sneeze at, whether they are in construction or somewhere else. If you want to criticize the pipeline, do so on the basis of environmental concerns, not because 20,000 jobs is somehow a bad thing. Unfortunately for the most outspoken critics, I for one don't think the environmental concerns amount to much ... it's not that hard to reroute the pipeline around the sensitive areas protesters claim to be concerned about. You'd be more likely to change my mind about the pipeline by showing me that is incorrect than by trying to convince me 20,000 jobs don't really matter too much.
How Big is 20,000 Jobs?
written by Dean, December 18, 2011 11:33
Dr. Jim you're welcome to believe whatever you want about 20,000 jobs -- it is about equal to what we should expect from a decline in the value of the dollar of 0.03 percent. If you are apparently excited about the prospect of 20,000 jobs being created by the pipeline, I trust that you would be 10 times as excited about the prospect of a decline in the dollar of 0.3 percent.

I actually did not say what I thought about the pipeline. I said that people should put the numbers in some context and that the Post let the industry print an inaccurate number about unemployment in the construction industry.
Not really 20,000 new jobs
written by BillB, December 18, 2011 11:47
It is also worth noting that, according to TransCanada, it is not really 20,000 new jobs. It is 10,000 jobs for two years, which is quite different than most people would think. Just routine deception by the pipeline proponents.
www.lexalexander.net
written by Lex, December 19, 2011 9:39
The problem, DrJim, is that while 20,000 jobs is, indeed, 20,000 jobs, the likelihood is that TransCanada's fatuosu claims notwithstanding, the project will not create anywhere near 20,000 jobs even if you count the hookers. Direct job creation of somewhere between 1,200 and 2,500, for two years, is a more reasonable estimate.
NIMBY Nebraska
written by FoonTheElder, December 19, 2011 5:01
It's amazing how many of the 'drill, drill, drill' Republicans here in Nebraska are totally up in arms about this pipeline. I guess it's a different story when oil is dumped in your backyard.
...
written by DrJim, December 19, 2011 5:57
@Dean

I realized what you were saying, but my point is that it is a distinction with little difference to make an issue of the fact that the 20,000 jobs aren't all in construction, or that that unemployment among construction workers is really "only" 13.1%. I agree that the Post should try to print accurate facts, but I don't see the inaccurate facts they printed as materially affecting the issue. The important question at hand is whether the pipeline should go ahead or not.

@BillB, Lex

There are reasonable people who disagree. Here's Jim Hamilton's take:

http://www.econbrowser.com/archives/2011/12/costs_and_benef.html
...
written by mcarson, December 19, 2011 9:51
Oil companies lie - all the time - about everything - even when they don't have to.

Did you know a huge part of their jobs creation is a formula that says 1 gas pump job is created for X amount of gas - so they take credit for the job creation of selling their product?
Mr.
written by Mike Schoenberg, December 20, 2011 11:29
With our ditherin the Prime Minister has threatened to ship the oil to Asia. Why not to us? The thought of a 1600 mile pipeline going through the heart of the country seems absurb.

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Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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