How storms will wreak havoc on jobs report

HURRICANES also do major damage to economic statistics. It just takes a little longer for the wreckage to appear.

On Friday, the Labor Department will announce the number of jobs that were created in September, which was affected by three major hurricanes — Harvey, Irma and Maria.

The consensus on Wall Street is that September will see job growth of only 100,000 and the unemployment rate will stay at 4.4 percent.

There were 156,000 new jobs in August, so a number as low as that would be disappointing — if it couldn’t be blamed on the extraordinary weather.

The key to what the feds will report has to do with one word — “impute.” I’ll get to that in a moment.

Labor Department officials are barred from talking about anything that has to do with Friday’s report — but the department has already answered some questions about how it handles hurricanes and other extremely bad weather.

Here’s a timeline that you need to understand.

Companies report the number of employees they have during the week that includes the 12th of the month. So, the reporting period this year would be Sept. 10 to Sept. 16.

And remember that the government counts people as being employed if they worked only one hour during a month. So companies that had to shut down because of the storms still counted people as being employed — and their jobs as having existed — even if they worked only that minimal amount.

Those company reports are used to determine the number of jobs in the US and, from that, determine how many new jobs were created.

Hurricane Harvey was active in the US, starting in Texas, from Aug. 25 to Aug. 31. That’s outside the survey period, but there was substantial damage that could have kept stores and businesses closed for weeks afterward.

The same thing is true for Hurricane Irma, which hit Florida on Sept. 10 and lingered. Maria, which hit on Sept. 20, won’t affect the numbers because Puerto Rico, which suffered the most from this storm, isn’t included in the figures.

The question is how much “impu- tation” Uncle Sam will do to make up for the fact that some hurricane-affected companies weren’t able to report September data.

That issue will definitely be dealt with in Friday’s figures, probably in a box on the front page of the report. But a clue to how the hurricane will be handled can be found in the way the government reported data after 2005’s devastating Hurricane Katrina.

In September 2005, the number of Katrina-affected jobs in the country declined by 35,000. In fact, the effects even carried over into October, when only 56,000 new jobs were reported.

It wasn’t until November, when the job count jumped by a more reasonable 215,000 jobs, that the effects of Katrina ended.

There was another hurricane that year, called Rita, but it struck after the company data were reported, so Rita had no impact.

For Katrina, Uncle Sam had to modify the estimates — the imputations — that it was working with because if that hadn’t been done it would have looked like all the businesses affected by the hurricane no longer existed even if they only failed to file their paperwork.

Officials will likely have to make the same adjustments on Friday.

Bottom line: The employment data coming out Friday will be even less reliable than it normally is.

The battle over President Trump’s tax reform package is about to begin.

The Post on Wednesday reported that Republicans were considering allowing homeowners to deduct from their federal taxes either the mortgage interest they pay or their property taxes — but not both.

It’s clear why this is happening. Politicians are trying to find a way to make the tax reforms proposed by Trump less damaging to the nation’s deficit.

Continuing to allow both deductions — which will greatly reduce tax revenue to the government and raise the US debt — would obviously be greatly preferred by homeowners.

Taking away one off these deductions will cause an uprising among anyone who owns, builds or sells houses. So that just ain’t gonna happen.

And when the tax reformers get down to other nitty-gritties , they will find similar opposition to most other provisions in their proposal. And that’s why I continue to think more strongly than ever that complete tax reform like what Washington is proposing will be impossible to accomplish. In July 2016, Kevin Warsh said the Federal Reserve has done some things that are “a bit puzzling.” I’ll second that and add the words “strange, dangerous and irresponsible.” Nobody should care about what I think. But Warsh is said to be one of the top contenders for the Fed chairman job — so investors should listen to what he has said. The Fed, Warsh said, “Look(s) to me to be asset-price dependent, more than they look (economic)-data deppendent.” Warsh, a lawyer and financier who left his job as Fed governor in 2011, is basically saying that the Fed has been a slave to the stock market. And that — I’m saying — has created a bubble. So there is some trepidation on Wall Street that Warsh wouldn’t be nearly as friendly to the stock market if he got JanetYellen’s job. He’d be inclined to raise interest rates like the Fed is supposed to do without considering Wall Street’s opinion.