UPDATE: READ THE THIRD UPDATE FIRST; EVIDENTLY I WAS MISTAKEN ABOUT THE GOOD DOCTOR’S USE OF THE “NET JOBS” TERM.
My Pet Jawa has issued a post defending Bush’s record by putting net job creation in perespective. I don’t have the time (and honestly, the inclination) to shift through the Bureau of Labor Statistics data, but found his graph interesting.
If the good Doctor Shackleford is attempting to support the re-election of a Republican, perhaps he should rethink his data presentation. According to Shackleford, of the Post-World War Two presidential terms, net jobs have increased in 5 of 6 Democratic terms. Net jobs have declined in 6 of 8 Republican terms.
If we judge economic stewardship SOLELY on net job creation, Democrats have been successful 83% of the time and Republicans have been successful 25% of the time.
Of course, judging the economy solely on one factor without controlling for extraneous variables would be silly. But in the era of sound-bites and short attention spans, some people might look at this data and say, hmmm….
Now, again confessing my rampant laziness for not looking at the statistics myself, but I just don’t see how there could have been net job losses in so many administrations when the economy itself is SOOOO much largerthan it was in 1948. Additionally, I would think the administration most likely to have lost net jobs would have been Truman’s. Even discounting the loss of public sector jobs, I would think that there would have been a huge downturn in private sector jobs even though we made a smoother transition to butter (from guns) than we had after the Great War, mostly because so many soldiers voluntarily removed themselves from the job market to pursue educational opportunities under the G.I. Bill.
Is this strange graph an artifact of an odd definition of “net job creation?” Someone please clarify this for me.
UPDATE:
It occurs to me that, if we were on the right side of the Laffer curve (see previous discussion here, here, and here), Clinton’s tax cut should have had an immediate impact on job numbers. If the tax level was rising in an environment already disincentivizing market risk (is disincentivizing a word?), business should have reacted quickly to cut jobs and limit hiring.
The tax cuts in the Reagan years aren’t necessarily supportive of where we are on the laffer curve. Yes, you might expect tax cuts in a country on the right side of the curve would lead to immediate job growth, but I would think that there would be a lag time before new enterpises could be online; it is faster to fire an employee than hire and train one. So I’ll grant the Maximum Leader that, if we were on the right side of the curve as he maintains (or at least plays devil’s advocate for), the drop in jobs in Reagan’s first term might not entirly debunk that position since it might take a while for private enterprise to react. That concession granted, I think the Clinton’s enormous tax increase DID NOT lead to net job loss, hinting rather strongly that we are indeed on the left side of the Laffer curve.
UPDATE II:
This whole post may be irrelevent. I took another look at the graph trying to figure out what I was missing and realized that, based on the graph, we have FEWER net jobs today than in 1944. Um, I think not. Either the numbers contain mistakes or I just don’t understand the economic definition of “net jobs.” I have sent the good doctor an e-mail asking for clarification.
UPDATE III:
The whole post is indeed irrelevent; Dr. Shackleford kindly wrote me back and explained:
It’s all an artifact of the baseline measure. If I want to see if unemployment went down or up in a Presidential TERM than what I look at is the number of unemployed at the beginning of the term vs. the number of unemployed at the end of the term. If less people are unemployed at the end of a term than at the beginning, we have NET jobgrowth (seasonally adjusted). Read the post again. If I am President and I come into office with an 8% unemployment rate, in the middle of my Presidency it drops to 6%, but at the end of my Presidency it goes up to 8.1% we have (adjusting for other fators) job losses. Even if for 47 months the jobs figures improve, if in that final month they decline - well, you see. When measuring something like ‘decline’ or ’surge’ you always have to pick a baseline. My point is simply that Kerry’s numbers are made up–fiction–no where even near the truth. Also, as per your last update you misread the data. These are not the # of jobs total, which is almost always on an upward curve (thanks to population growth). That would be spurious and is also why Kerry’s absolute number of 1.6 million jobs lost is misleading (since our population is now approaching 300 million with most women working vs. 1946 when women stayed at home and the population was, what, 100 million?). By ‘net jobs’ I simply mean the number of unemployed people at the end of a Presidential term vs. the number of unemployed people at the beginning of the term. I explained that in a previous post, but I should ave also clarified it here. I do not even adjust for population and it still shows that Kerry’s repeated statements about the jobs numbers are false!!
I would quibble with the choice of terminology for net -> I tend to think in accounting terms when I hear “net loss” or “net gain.”
If we looked at number of total number of jobs existing at the beginning and end of each presidential term, I think the statement that no “president since Hoover has had a net loss of jobs” holds up; even though Reagan might have had a higher unemployment percentage at the end of his term, the increased size of the workforce would mean that there had still been a net (in accounting terms) gain in jobs. Shackleford says as much when he says that the “total number of jobs is almost always on an upward curve.” Has the total number of jobs continued on the upward curve since 2000? If not, then I would say that Kerry’s statement is accurate. Volunteers to slog through the numbers and find out?