Reclaiming Common Sense

January Jobs Report - Best January Ever

The January Jobs Report was released this past Friday. Most of the media was "caught off guard" by the solid January Jobs Report. The data behaved pretty much as this column had projected: Non-seasonally adjusted jobs, full-time and part-time, fell, non-seasonally adjusted workers fell, and unemployment rose. Seasonally adjusted, full-time and part-time jobs fell, unemployment rose, and both Private Sector Workers and Non-Farm Payroll  Workers increased in numbers.  The details are covered in "January Jobs Report: Shutdownproof Economy?" Next this column examined the revisions to the Current Employment Statistics data and the wage changes in "January Worker and Wages Data: Up and Up." All Sectors grew January to January and All sectors earned higher wages this January than last January.

This column has produced a series comparing the current President with his predecessor at the same point in time during their Presidencies. The "Four Presidents at __ months" series started during the final two years of the Obama Presidency. The "Five Presidents at __ Month series started with the February 2017 Jobs report because President Obama was President on January 12th when the data was collected for the January 2017 Jobs Report.The series started because there was a meme comparing President Obama with almost two years remaining in his Presidency with his predecessors at he end of their Presidencies, excluding President Reagan and including one-term President George HW Bush.

President Reagan inherited the economy from a Democrat, former President Carter, President Clinton inherited his economy from a Republican, former President George H.W. Bush.  President George W. Bush, a Republican,  inherited the economy from former President Clinton. President Obama, a Democrat inherited the economy from former President Bush.  Most of the time the party in power changes when the economy is weak or weakening.   It is important to compare the Presidents at the same point in their Presidencies.

President Trump and Former President Clinton are the only Presidents to reduce unemployment and Add Jobs. after 24 months in office.

  • President Reagan lost 2.4 million Full-time (FT) jobs, added 1.6M part-time (PT) jobs and saw U-3 Unemployment increase by 3.771M
  • President Clinton added 2.8 Million FT jobs, plus 2.8M PT jobs, and reduce unemployment by 2.1 million workers
  • President Bush oversaw the loss of 1.3 Million FT jobs, the creation of 1.0 million PT jobs, and saw unemployment jump by 2.75 million .
  • President Obama oversaw the loss of 3.4 million FT jobs, the creation of just 605,000 PT jobs and an increase of 1.9 million unemployed workers.
  • President Trump has overseen the addition of 5.1 million FT jobs, the trimming of 713,000 PT jobs and a drop of over 1.0 million unemployed.

Yes, President Clinton started with a smaller workforce population and President Trump started with the largest workforce population. Former Presidents Reagan,  Clinton, Bush and Obama also started with higher participation rates than President Trump.

Does Workforce Population grow better under a Republican than under a Democrat?  President Bush added 6.009 Million to the workforce. President Reagan added 4.25M to the workforce population. President Trump has already added 4.157 million workers.  President Obama added 3.965 million workers to the workforce population. President Clinton only added 3.791 million to the workforce. When you add more to the workforce population than you add jobs then the participation rate falls. The workforce population is revised every January.President Obama saw his workforce population revised down twice during his first two years in office, otherwise his participation rate would have been reported even lower than it was. President Trump's first revision was upward, reducing his participation rate last January. Some of President Trumps population gain is based on a larger workforce population. The same cannot be said regarding President Obama versus President Bush.

Do we really have a non-seasonally adjusted unemployment rate comparable to President Clinton's unemployment rates during January 1999 and January 2000?  The participation rate is masking the real unemployment rate. If you look at the unemployment rate and the participation for the month of January from 1980 through 2019 you will find that The true unemployment rate, the Effective Unemployment Rate, or U-7, is closer to 10% than it is to 4%.

But Wait, President Obama had a better final two years than President Trump had for his first two.... Right? Wrong. The former President wanted to take credit for the current economy while campaigning for candidate during the mid-terms,. President Trump has added 5.1M FT Jobs to former President Obama's 4.175 Million FT jobs during his final two years in office. Even with President Trump trimming 713,000 PT jobs to President Obama trimming only 200,000 PT jobs, President Trump has added 4.4 million jobs to the former President's 3.9 million jobs.

Unemployment is down. Jobs are up. President Trump has overseen the addition of more FT jobs than all of his predecessors combined.  Only former President Clinton is close to the statistics that President Trump has after 24 months in office. The only comparable record belongs to former President Clinton and President Trump, not former President Obama.

It's the Economy.