Did you know that the economy was on a "hiring binge" until February? Gosh, neither did I until the headline to Paul Wiseman's report at the Associated Press yesterday afternoon informed of that.
I also didn't know that economies took breaks, but that's what the AP's headline said the economy did in March. And don't worry -- "few economists expect hiring to fizzle in spring and summer, as it did the past two years." Correct me if I'm wrong, but they weren't expecting to see fizzling in 2011 or 2010, and guess what happened (or maybe they were just extended "breaks")? What follows are the first five paragraphs from Wiseman's dispatch, plus selected others:
The U.S. job market took a breather in March after its best hiring stretch since the Great Recession.
Employers added 120,000 jobs last month - half the December-February pace and well short of the 210,000 economists were expecting. The unemployment rate fell from 8.3 percent in February to 8.2 percent, the lowest since January 2009, but that was largely because many Americans stopped looking for work.
Still, few economists expect hiring to fizzle in spring and summer, as it did the past two years. And they blamed seasonal factors for much of Friday's disappointing report from the Labor Department.
"We don't think this is the start of another spring dip in labor market conditions," said Paul Ashworth, chief U.S. economist with Capital Economics.
The report was also closely watched in political circles. If employers retreat on hiring, consumers could lose confidence in the economy and potentially dim President Barack Obama's re-election hopes.
... A warm January and February allowed construction companies and other businesses that work outdoors to hire workers a few weeks earlier than usual, effectively stealing jobs from March. It helps explain a 7,000 drop in construction jobs.
... Economists also say the numbers can bounce around from month to month. Consistently creating 200,000 jobs a month is tough. The economy hasn't put together four straight months of 200,000 or more new jobs since early 2000.
... Companies across the country are hiring ...
Wiseman goes on to cite five companies which are adding employees. Does anyone remember an AP reporter citing five examples of hiring when the economy under George W. Bush added over 7.7 million seasonally adjusted jobs from 2004-2007, bringing the unemployment rate well below 5%?
As to the whine about how "consistently creating 200,000 jobs a month is tough":
- The economy under Ronald Reagan did that for 19 out of 20 months from April 1983 to November 1984. The monthly average during that time off a 30% or so smaller workforce base was 344,000. The 18.4 million jobs added under Reagan from the November 1982 end of that decade's recession to when he left office in January 1989 represented a monthly average of 248,000.
- The economy under Bill Clinton added 200,000 or more jobs in 22 of 24 months from April 1993 to March 1995, and had another run of 38 months out of 49 from May 1996 through May 2000. The former was what one would expect an economy to do coming out of a recession. The latter was largely due to supply-side economic policy changes, primarily a 1997 capital-gains tax cut, which took effect after Clinton's reelection.
- The only reason that it's "tough" for the economy to create 200,000 jobs a month with millions of workers available is that the administration's policy choices (stimulus, heavy regulation, anti-business bully pulpit, looming ObamaCare) have been so counterproductive.
The entire post-recession Reagan era and most of the Clinton era saw real hiring binges. There has been nothing even resembling such a binge under Obama, and it's an outright deception to pretend otherwise:
Looking at the history of not seasonally adjusted job additions shows why the breezy assumption that the economy, particularly the private sector, will resume adding lots of jobs on a monthly basis is very suspect:
Note how March's actual job adds only translated to 121,000 after seasonal adjustment. That happened primarily because the 706,000 raw jobs significantly trailed last year's 823,000.
For the economy to add 300,000 seasonally adjusted jobs per month during the spring -- which really should be the minimum acceptable benchmark given the legions of unemployed, the still high unemployment rate, and the millions of workers sitting on the sidelines who aren't considered in calculating the official unemployment rate -- we would have to see 1.2 million jobs added on the ground in April, 930,000 in May, and 1.1 million in June. That's over 3.2 million jobs, when the last two years have only come in at 2.55 million and 2.76 million. Somehow, this will almost assuredly occur despite the high prospect of $4.50 - $5 per gallon gas prices and any number of other potential economic hazards. I'm not saying it can't be done; I am saying that telling readers that it's the most likely outcome is an exercise in pretense.
Separately, President Obama told an audience yesterday: "So we welcome today’s news -- (applause) -- we welcome today’s news that our businesses created another 121,000 jobs last month, and the unemployment rate ticked down."
I don't know what's more insulting to our intelligence: Obama's pretense that yesterday's news was "welome," or the disinformation from the AP, aka the Administration's Press, acting as if it was only a "break" after a hiring binge which has never occurred.
Cross-posted at BizzyBlog.com.
