Economy

Nobel-winning economist Robert Shiller says the nation's jobs picture is not as bright as it seems

Key Points
  • The unemployment rate reaching new 50-year lows may not actually be the best indicator of job market and economic strength, says Yale professor Robert Shiller.
  • "You can spin this report any way you want," he says. "The unemployment rate is a fuzzy number."
  • "The flat wage number in this report suggests it's not really a strong economy," he adds.
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Low jobless rate is a 'fuzzy number,' says Yale's Robert Shiller

The unemployment rate just dipped to a 50-year low, but Nobel laureate Robert Shiller says the number may not be the best indicator of the strength of the job market and economy.

"It looks kind of hard to criticize Trump's economic success," the Yale University economics professor told CNBC on shortly after the government released its September employment report on Friday.

The report found that the jobless rate dropped to 3.5%, a level last seen in December 1969.

The number certainly can boost confidence, Shiller said, but "the unemployment rate is a fuzzy number."

"I don't know if it is entirely comparable to 50 years ago. We have different thoughts about that now," said Shiller, who won the Nobel Prize in economics in 2013 for his work on asset prices and inefficient markets.

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The drop in the nation's unemployment rate comes as the economy saw another sluggish month of job growth. Nonfarm payrolls increased by a lower-than-expected 136,000 in September. Additionally, average hourly earnings were little changed last month, translating into the lowest annualized increase since July 2018.

"The flat wage number in this report suggests it's not really a strong economy," Shiller said on "Squawk Box." "You can spin this report any way you want."

For President Donald Trump, the headline to focus on is the unemployment number, suggested Shiller, co-creator of the S&P Case/Shiller home prices index. Trump did so Friday, while also using the jobs report to take aim at the Democrats' impeachment inquiry.