The national unemployment rate fell to its lowest level in almost three years in December–going back to February 20009, when it was 8.3 percent–as the economy added 200,000 and the number of unemployed fell to 13.1 million, all signs pointing to an economy finally strengthening past anemia.
The number of jobs in November was revised to 120,000, a 20,000 increase, although the number for October was revised downward by 20,000. Fears of a second recession, rife in summer, have now passed. The figures are also a boon to President Obama’s reelection prospects, which dim if the unemployment rate remains high just as they brighten considerably if the rate continues to fall, particularly if it falls below 8 percent.
For the first time since the economic downturn–at least in significant numbers–the decline in unemployment was the result of actual job creation, rather than a reduction in labor force participation or people dropping off the unemployment rolls. Job creation in the last 12 months–1.9 million–is the highest for a 12-month period since 2005.
“Today’s employment report provides further evidence that the economy is continuing to heal from the worst economic downturn since the Great Depression,” Alan B. Krueger, chairman of the White House Council of Economic Advisers, said in a statement this morning. “It is critical that we continue the economic policies that are helping us to dig our way out of the deep hole that was caused by the recession that began at the end of 2007.”
Mitt Romney, the leading contender for the GOP presidential nomination, ridiculed the White House’s conclusions this morning. “This president doesn’t understand how the economy works,” he said. “It’s time to get a president who does.”
Twice before since the 2008 economic crisis the economy appeared to pick up only to lose job gains a few months later. Two factors may yet cripple this latest attempt at recovery: first, Europe will almost certainly fall into recession this year (France is already in one), creating a drag on the American economy as exports to Europe fall and European tourism, especially to Florida, a favorite destination for Europeans, lessens. Second, the temporary payroll tax cut and extended unemployment insurance are both set to expire at the end of February, if Congress doesn’t act. Both those measures put billions of dollars into ordinary consumers’ hands, powering the economy. Their elimination would shave several decimal points off the economy’s growth rate.
Jean Jenner via Facebook says
Another devastating news for Republican Presidential candidates.
Gia says
This is not to be impressed. A lot of folks were hired for the holiday, they’ll go back home very soon. Wait for the unemployment %% for next month. Those will be the reel figure.
Laffer Curve says
I would argue that any net gain in jobs has happened despite the current President’s efforts, not due to them. We currently have the most anti-business, anti-profit, status quo chief executive in this Nation’s short history. Even with Obama’s anti-business, pro big government philosophy, he may win a second term if Romney is the Republican nominee. I say that because there is very little difference in their policy stances. It would save the tax payers the cost of moving one family out and another family into the White House just to leave the Obama there. Of course, neither is a good choice.
There is only one alternative to Obama that is at once progressive and conservative in all the right places, that is Dr. Ron Paul. If anyone does their homework, he is the one candidate that makes any sense. Ron Paul, the thinking person’s candidate for 2012!
The Truth says
Republican’s will respond with the “but those numbers are skewed because they include seasonal help”. What they don’t realize is that these reports include an adjustment for seasonal help, which takes that into factor.
GB says
“I would argue that any net gain in jobs has happened despite the current President’s efforts, not due to them”. Actually, I would argue that the gain in jobs has happened BECAUSE of the president’s efforts, DESPITE Republican obstructionism and stone walling at every turn. Name me ONE jobs bill, or ANY bill that promotes employment, introduced by the Republican controlled congress….one? Anyone? Hello? Didn’t think so.
Matt says
And yet the economy only started adding jobs after the Republicans swept the mid-term elections at the national, state, and local level in November 2010. The chart shows a correlation between that and job growth.
Perhaps the government being prevented from intervening in the economy, the Republicans’ efforts to obstruct the Administration’s attempts to do so, are PRECISELY the reason the economy is finally growing.