We have been climbing a Jobs Mountain Since February 2017
How Is President Trump doing compared to his two term predecessors?
This year has been the Tale of two data sets, the Current Population Survey (CPS) jobs and unemployment data and the Current Employment Statistics (CES) Wages and Worker Data. The disagreement between the CPS and CES data was detailed in the May Jobs Report Forecast Article. There has been some disagreement between the ADP Payroll Report and the "Jobs Report." The February Payroll Report was strong while the February Private sector data was weak. The article "May Jobs Report Surprise after ADP Disappointment" detailed how that while we added 778,000 non-seasonally adjusted workers to the economy it was only reported as being an addition of 90,000 seasonally adjusted private sector workers. The article "Record May Wage and Worker Data" explained how all sectors saw annual wages rise. The growth in workers and wages meant a 4.50% increase in total income earned from May to May. The question is "Is this good enough to get President Trump re-elected?"
We have more Full-time Jobs, and more total jobs, this May than we have ever recorded. We have the most full-time jobs that we have ever had. We have the most total jobs that we have ever had. We have the lowest May unemployment rate since May of 1969. We have the fewest May unemployed workers since May 1975. The non-seasonally adjusted data can be found here. We have been climbing a "Jobs Mountain" since February 2017.
President Trump has added 7 Million jobs while trimming unemployment. Only Former President Clinton was able to do this after 28 months in office. President Trump has added 7.0 million full-time jobs, trimmed 419,000 part-time jobs, and cut the unemployment level by 2.6 million workers. One of the reasons while President Trump's participation rate is not as high as it could be is the cut in unemployment and the cut in part-time jobs cut the number of participants. Another reason his participation rate is not growing very fast is that the workforce population under President Trump is growing faster than it did under Clinton and Obama.
Former President Obama is the only former President of the five Presidents to see the total number of jobs decline during his first 28 months in office. Former President Obama saw 1.2 million fewer full-time jobs and 789,000 more part-time jobs 28 months after his inauguration. This is a net loss of 411,000 jobs. He also saw unemployment spike by 412,000.
Former Presidents Bush and Reagan saw roughly 1.4 million jobs created after 28 months in office. Former President Reagan saw a loss of full-time jobs and a gain in part-time jobs. He also saw a spike in unemployed workers. Former President Bush saw growth in full-time jobs and part-time jobs and unemployment.
Former President Clinton oversaw the creation of 7.5 million jobs - only 5 million of which were full-time jobs. This is where you may hear that Clinton was the best jobs President. It depends on the full-time part-time mix, the point in their Presidencies, and the size of their economy. Reagan added almost as many jobs as Clinton by the end of their Presidencies and Reagan had a lower starting point.
Former President Clinton and President Trump are the only two Presidents of the five who saw their unemployment rates drop during their first 28 months in office. President Trump has the lowest May unemployment Level since may 1975, when the workforce was much smaller. There are 60 million more workers in the workforce population this May than during May 1995 and fewer unemployed workers. President Trump's non-seasonally adjusted U-3 unemployment rate is 3.38% compared to Former President Clinton's 5.45%.
Participation Matters. Former Presidents Bush and Obama were the only Presidents to have lower participation rates after 28 months in office than they had at their inaugurations. President Regan saw participation rise as unemployment rose. Only Clinton and President Trump saw their participation rates rise as their unemployment rates fell. If you compared the participation rate and unemployment rate for May 2019 and May 2000 you would find that the "effective" unemployment rate, or U-7, is 9.35%. The participation rate during May 2000 was 66.97% compared to this month's 62.83%. There are more than 10 million potential workers who are neither employed nor unemployed. These are the missing participants.
"All recessions are job recessions." That has been said in this column in many articles. As long as the same month data is better than the prior year we are expanding. If wages rise and workers rise then total income rises. If total income rises than retail sales, and home sales, can expand. If real estate expands and retail expands then GDP expands. The jobs and workers numbers are in expansion, not contraction. The annualized GDP and same quarter GDP should expand from their current levels of 3.1% annualized and 3.2% same quarter. If it really is "The Economy," the jobs data, worker data, unemployment data and GDP data are pointing to a second term for President Trump.
There are other ways to examine the jobs data. How are men and women doing? What is happening with regard to the number of multiple job workers? This will be the next installment of the May Jobs Report analysis.
It's the Economy.
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