Jobs Doom or Boom for Obama? Neither
NEW YORK (TheStreet) -- Snap judgments on whether January's positive jobs numbers indicate impending doom or a boom on President Obama's re-election chances might be greatly exaggerated.
January jobs numbers were essentially positive as the economy added 243,000 jobs and cut the unemployment rate to 8.3% from 8.5%, but what happened in January won't necessarily transform into November votes.
"Don't muck it up," Obama said, referring to Congress, in a speech after the Bureau of Labor Statistics had released the jobs numbers."The number is high, but the trend is in the right direction. ...To have successive months of increasing employment and decreasing unemployment rates, those are good signs," said David Weiman, a Barnard College economist. "I do think that's what individuals are looking at -- they're obviously concerned where they are, but they're also sort of figuring out what's going to happen down the road." Weiman warned that recent positive trends aren't necessarily permanent for 2012, and he specifically cited the hope that nothing goes "crazy" in Europe. The continent continues to struggle with the sovereign debt crisis that has roiled eurozone nations since 2011. Republican front-runner Mitt Romney released his spin on Friday's jobs numbers, as he said he welcomed the unemployment decline, but that the president's policies have prevented true economic recovery. "Last week, we learned that the economy grew only 1.7% in 2011, the slowest growth in a non-recession year since the end of World War II," Romney said in a statement. "Unfortunately, these numbers cannot hide the fact that President Obama's policies have prevented a true economic recovery." Romney tactically chose to highlight overall economic growth in order to avoid more favorable comments on the strong uptick in job growth -- a number the Obama campaign is likely to tout for the next month. The Romney tactic seems like a bag of mixed goods. One economist has argued that unemployment is part of a greater collection of economic indicators that could determine November's election. Yale economist Ray Fair said in an interview that his presidential vote equation argues if per-capita GDP has grown in the three quarters before an election, then voters would take it as a positive sign. He adds that the unemployment rate and job growth are two indicators correlated to overall growth.
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