Don’t Pop the Champagne on Those Job Numbers
Democrats are reacting to today’s jobs report with an optimism that’s also notably guarded. (Despite the 0.3 percent drop in unemployment, House Speaker Nancy Pelosi (D-Calif.), for example, described the news tepidly as “a welcome step in the right direction.”)
Turns out, there’s probably good reason for the caution. Gus Faucher, director of macroeconomics at Moody’s Economy.com, warned today that the nation’s unemployment rate — 9.7 percent in January — will likely jump back near 11 percent later this year. “We expect it to go back up,” he told TWI, adding that his group estimates that it will take almost five years (the end of 2014) before the figure gets down to 5.5 percent.
It’s not because the nation’s employers are readying a purge. Rather, Faucher explained, the news of recovery will likely stir those who’d stopped looking for jobs to relaunch their search, returning themselves to the pool of unemployed folks that the Labor Department uses to crunch its numbers. Practically, then, the jobs crisis won’t be getting worse, though officially the unemployment rate will increase.
The Democrats, it seems, are cautious enough to recognize that voters likely won’t recognize that distinction in November.