Even with all the good news about the economy we still get the lefties and the MSM shrilly crying that the economy is failing and it’s all Bush’s fault: (via the WaPo)
The new employment figures come as President Bush continues to get lukewarm ratings for his economic stewardship. Just 41 percent of the public approves of the president’s handling of the economy, compared with 57 percent who disapprove.
Of course this comes in an article full of good news, with caveats. What kind of good news?
- Unemployment dipped from 4.6 to 4.5 last month
- 97,000 new jobs were added last month
- 226,000 new jobs were added in December
- 146,000 new jobs were added in January
- Average hourly earnings rose .40% to $17.16
- For the year ending in Feb hourly earnings rose 4.1%
- 2.5% average net worth gain in American households from the 3rd quarter
Ok, I added the last one from the news yesterday but it’s big news, so I included it. Now looking at the WaPo article we get these caveats:
"even as big losses of construction and factory jobs restrained overall payroll growth."
"The latest snapshot, released by the Labor Department on Friday, offered a mixed picture of the employment climate."
"The slight decline in the politically prominent jobless rate, from 4.6 percent in January, came as hundreds of thousand of people left the work force for various reasons."
"Strong wage growth is welcome by workers and supports consumer spending, a key ingredient to the country’s economic health. But a rapid pickup — if sustained and not blunted by other economic forces — can raise fears about inflation."
"added 97,000 new jobs to their payrolls in February, the fewest in two years,"
Yup, the economy is doing well so try to talk it down as much as possible until a Democrat gets in office. Then talk glowingly about the "turnaround" in our economy. We’ve never seen that right?
That last nugget of skepticism in the above quotes is interesting. The economy added 97,000 new jobs but economists were predicting 100,000 so we can all surmise that it’s not doing so well. Problem is that every report is almost always revised upwards, at least for the last few years: (via The Shareholders Corner)
Lately we noticed a divergence between the initial reporting and subsequent revisions upward (here and here). So we reached into the numbers a bit more over the weekend. Here is what we discovered.
- The federal government has underestimated employment growth for 22 months straight (since March 2005).
- The initial reports from January 2005 through December 2006 produced a total of 3.4 million jobs or 142,000 jobs per month.
- Most economists suggest 140,000 to 150,000 jobs are needed per month to keep up with labor force growth.
- Growth in this range would suggest the unemployment rate would remain neutral or slightly increase.
However:
- The unemployment rate decreased from 5.2 percent in January 2005 to 4.5 percent in December 2006.
- Revisions from the initial reports to the actual number shows an increase of 1.384 million jobs above the initial reports during the same time period.
- In total, 4.784 million jobs were created over the past two years for a monthly average of 199,000 jobs per month.
- This level of job creation per month is viewed as a very strong economy.
- The difference between the initial reports and the subsequent revisions results in a 40 percent underestimation on the first Friday of each month.
The results of the past two years are a deterioration from the previous two-year period. Between January 2003 and December 2004, BLS overestimated employment in its initial report eight times, underestimated employment 15 times, and hit the exact number once. For the two year period initial reports totaled 1.7 million jobs and the actual number was 2.172 million jobs – an underestimation of 469,000 jobs or 27.5 percent.
As you can see, with the revised numbers over the last two years our economy has added an average of 199,000 new job per month. Pretty damn good wouldn’t you say?
This morning’s Marketwatch headline proclaimed today’s report of 97,000 jobs is the lowest level since January 2005 when the month recorded a level of 95,000 new jobs. However, this is very misleading. Since January there have been four initial monthly reports under 100,000 jobs for the month. January 2005 was initially reported at 75,000 but was revised higher to 95,000. September and October 2005 were initially reported as 48,000 and 37,000 respectively. Yet, their final revisions 105,000 and 107,000. More recently, October 2006 was initially reported as 86,000 new jobs but the revised number came in at 109,000.These numbers will be revised higher and bring the level over 100,000. Yet, the naysayers will still be saying job growth is slowing.
CNN, the mother of all things biased, even reported this last month:
But the numbers will also include the Labor Department’s so-called benchmark revisions to job numbers for April 2005 through March 2006. While it’s gotten very little attention, the department’s Bureau of Labor Statistics (BLS) estimated last October that the revisions will add about 810,000 jobs to its count of U.S. payrolls for that 12-month period.
In addition, the BLS will make changes to its estimates for April 2006 through December 2006, and some economists say several hundred thousand additional jobs may be counted for that period, meaning the overall job gain could top 1 million. Wachovia senior economist Mark Vitner estimates a total net gain of 1.2 million from all the revisions.
All this and we still get this from our MSM:
consumers will pay more for gasoline in the weeks ahead as fuel demand picks up going into the spring driving season, but a slowing economy may keep pump prices from rising as much as normal, energy experts said on Monday.
Yeah, slowing…..
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There is little to celebrate about the jobs report when nearly 50,000 of 96,000 jobs added are Government jobs.