There’s really only one way to interpret today’s jobs numbers: they are excellent. Last month, the economy added 227,000 new jobs; in addition, the numbers for December and January have been revised upward. The gains are all in the private sector, as government jobs continued to decline slightly (6,000 lost in February). The national unemployment rate remained at 8.3% because “nearly half a million people who had been staying on the sidelines rejoined the search for work.”
The report followed a flurry of positive economic reports about the American economy, including a continued rise in consumer confidence and growing strength in the manufacturing sector.
“We’re at what I think we could characterize as escape velocity,” said Patrick O’Keefe, director of economic research at J. H. Cohn, an accounting and consulting firm. “The jobs recovery will finally have achieved the momentum that is necessary.”
Let’s look at a couple of charts, because really, who doesn’t love a chart? And let’s start with the one that shows what everyone says they really care about: jobs in the private sector. (You can see a more complete version, including month-by-month numbers, at this link.)
That chart, of course produced by the Obama campaign, shows with remarkable clarity that, in terms of jobs in the private sector, things got a lot worse under George Bush, and started getting better under Obama. It really is that simple.
Here’s another one, from the excellent Calculated Risk blog (click for larger):
What this chart shows – and this is really important – is how very, very bad this recession was compared to every other post-World War II recession. Yes, things are getting better. But it’s going to take time to recover from what eight years of failed Republican economic policy and rampant, irresponsible speculation on Wall Street brought us. The job losses we suffered from the beginning of the recession were historic in magnitude, and you simply cannot reverse that kind of damage overnight.
The depth of the recession (which Republicans would like everyone to please forget) is important because, predictably, Republicans are already trying to spin today’s job numbers roughly along the following lines: “well, of course we’re happy to see growth in jobs, but if it weren’t for Obama’s lousy policies things would actually be much better.”
The reality is this. First, Republicans in fact are not happy to see rapid growth in jobs. This is because they know full well that if job growth continues along these lines, it is basically impossible for them to win the presidency in November. Second, the notion that, absent Obama’s policies, things would be better than they are is at best magical thinking. It’s of course impossible to test counterfactual hypotheses, but the GOP offers nothing in support of what they are saying. Whereas, if you actually look at the data, you find that, absent the stimulus bill, things would actually have been worse. Here, for instance, is a chart of Congressional Budget Office estimates of what the unemployment rate would have looked like absent the stimulus (click for larger).
These are estimates; the effect might have been modest, or it might have been quite substantial. The point is that, if you look at the actual numbers, you see that things would have been worse, not better, absent Obama’s policies.
As an example of the extent to which the GOP will go to spin gold into straw, check out RNC Chair Reince Preibus:
Today’s jobs report is yet another reminder that far too many Americans are out of work, and the situation is clearly not improving.
Sorry, but that’s flat-out false. The situation clearly is improving. We can argue about whether it’s improving fast enough, etc., but a quarter of a million new jobs last month, and a half million people encouraged enough to start looking again, is an improvement by any rational measure.
One final interesting datapoint: what would happen if job growth continued roughly along the lines of the last couple of months? Fortunately, the Atlanta Federal Reserve has set up a spiffy calculator to tell us. According to the calculator, if we keep seeing job growth of 200,000-250,000 new jobs a month, we can expect to see the unemployment rate fall to something like 7.5% by October. Numbers like that will make it nearly impossible for Republicans to win the White House, and might actually result in their losing the House of Representatives as well. And should the numbers actually do better than that – if, say, job growth averaged more like 350,000 a month between now and October, the rate would drop to below 7%, and the election would be over before it ever really got started.
Of course, if the recovery stalls between now and October, that creates a problem for Obama. So it’s important not to get too carried away by a couple of months of good reports. Still, it’s hard to see the last couple of months as anything but quite encouraging, both for Obama’s reelection prospects and, more importantly, for the economy as a whole.