Today's disappointing jobs report could end up as a campaign turning point for Mitt Romney
Judging by the state of the econoblogosphere around noon on Friday, after the release of the government’s labor report indicated that the economy created only 120,000 jobs in march, the question on every econ-watcher’s mind is how seriously should we take a one-month divergence from an existing trend?
At one end of the spectrum, we could interpret the new jobs numbers, which included a sharp decline in retail jobs, a la Matthew Yglesias, as proof of the “death of retail” — slain by the unholy combination of smartphones and online shopping. Maybe so, but it seems like a bit of a stretch. Or we could go in the completely opposite direction: Ryan Avent, economics blogger at the Economist, seems to be suggesting that the best path forward would be to just ignore the new numbers altogether.
Avent’s response to the news that U.S. labor markets had underperformed expectations came in the form of a darkly humorous post pointing out that the margin for error on the labor report was so high that the real number of jobs created in March could range anywhere from 20,000 to 200,000. So we really don’t have any idea whether March was an outright disaster, a continuation of previous healthy trends, or something in between. And the same goes for all the other numbers in the report:
Reported changes for important subsectors are too small relative to the margin of error to be worth discussing.
Ha ha ha. Very funny. Avent’s analysis is difficult to fault, but he should be careful: If all economics commentators followed his rules for reporting on new economic data, it wouldn’t be long before there wasn’t much of a market for any economics reporting at all.
But Avent does point the finger at an interesting conundrum. If the labor report had produced a “good” number, something above 200,000, there would have been a slew of reports about how the data confirmed the strength of the economic recovery, and very little discussion of how the high margin of error involved implied that it would be foolish to invest the “good” numbers with too much confidence. Not so with a report that virtually every (non-rabidly partisan) commentator considered “disappointing.” This time, caution about making too much of a one-month blip was the ubiquitous watchword.
And maybe the numbers aren’t so bad. As Felix Salmon noted, six months ago, the news that the economy had created 120,000 jobs would have been “decidedly encouraging.” The fact that our expectations have changed is the basis for our disappointment, for sinking feeling in our hearts immediately after the Bureau of Labor Statistics Web page finally loaded after countless fevered clicks at the dot of 8:30 a.m. EST. So maybe we should relax a little? The economy is still growing, albeit at a tortoise-like pace. The explanation for the shortfall could be something as simple as good weather pulling forward hiring that would normally have taken place in March into January or February.
The problem is, the hardest thing to figure out in real-time economy watching is when to spot the definitive beginning of a new trend, but those new trends do end up starting. And the stakes are simply too great right now to ignore any data, no matter how tentative. Control of the White House and Congress could very well hinge on how labor markets perform from now through the summer. If April’s numbers are worse than March’s, we’ll be able to look back and say, a-ha: here is where gas prices really started to bite into economic growth, or here is where Europe’s recession proved impossible to shrug off … and here is where Romney’s poll numbers started to pick up. Every now and then the canary in the coal mine does indeed die — it would be kind of foolish to blithely wave away this particular dead bird just because it might signify a freak avian heart attack.
How much further we should go is a fraught question. Liberals seized on Friday’s part to call for more infrastructure spending. Mitt Romney, as expected, immediately plugged the news into his campaign critique savaging Obama for presiding over only the most tepid of recoveries.
That kind of instant politics-fueled analysis is probably not merited by one month’s worth of numbers. But that won’t stop anyone, because of the non-negligible chance that their critiques end up being right on the money. So there’s your answer, as unsatisfying as it might be. We can’t accept Friday’s labor report as holy writ, but we can’t wish it into nonexistence either. Unless you are Mitt Romney, the number was disappointing.
More Related Stories
- Developers evict historic women's shelter to build luxury hotel
- Kaitlyn Hunt refuses plea offer, will go to court over high school relationship
- DHS admits "impossible" to control 3D-printed guns
- Journalists file suit against Manning trial secrecy
- Russia: Syrian regime ready to talk peace
- Report: Nearly a quarter of all Americans struggle to afford food
- Ted Cruz against the world
- Louie Gohmert: Women should be forced to carry nonviable pregnancies to term
- 2 men arrested for endangering commercial aircraft
- Oversized load blamed for bridge collapse
- This is what Guy Fieri looks like as a balloon
- Iran hackers aiming at U.S. energy firms
- Lawyers release data in attempt to discredit Trayvon Martin
- Anonymous rallies behind Kaitlyn Hunt
- Bridge collapse: Part of "aging infrastructure"
- Mistrial in penalty phase of Arias case
- Amanda Bynes arrested after hurling bong from window
- Interstate 5 bridge collapses north of Seattle
- Mississippi could begin prosecuting women for miscarriages
- Teenage girl claims she was beaten up for looking like Taylor Swift
- UK Military: London attack victim was a "model soldier"
Featured Slide Shows
The week in 10 picsclose X
- 1 of 11
Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
Credit: AP/LM Otero
Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
Credit: AP/Matt Rourke
A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
Credit: AP/Jenny Aicher
Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
Credit: AP/Molly Riley
Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
Credit: AP/J. Scott Applewhite
Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
Credit: AP/Carolyn Kaster
O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
Credit: AP/Las Vegas Review-Journal/Jeff Scheid
Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
Credit: AP/NASA/Chris Hadfield
When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
Credit: AP/Jacquelyn Martin
A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
Credit: AP/The Duluth News-Tribune/Clint Austin
Recent Slide Shows
- 1 of 11