The pace of job creation by private employers picked up in February, reinforcing hopes that Friday’s broader payrolls report would confirm the labor market recovery has moved into a higher gear.
The private sector added 216,000 jobs last month, the ADP National Employment Report showed on Wednesday, topping economists’ expectations for a gain of 208,000.
The ADP figures come ahead of the government’s more comprehensive labor market report on Friday, which includes both public and private sector employment.
As always, in political terms, what’s important is public perceptions of the direction the economy is moving in. Along those lines, Gallup finds that its Economic Confidence Index has risen for the sixth straight month.
That metric represents a combination of two things: How Americans rate current economic conditions, and their perception of whether the economy is improving. The latest finding, crucially, is driven by the latter:
Increasing public optimism about the economy’s direction has been mainly responsible for the gains in Americans’ overall economic confidence since last summer. This pattern continued in February, as the index’s economic outlook component improved seven points, rising to -15 from -22 in January. By contrast, perceptions of current economic conditions barely changed, rising two points to -29 from -31.
It would be folly to get overconfident; the Friday jobs report will be key. And the economy can always dip again, thanks to more misguided austerity and/or global events. But if this trend continues, it will be interesting to see how the Republican candidates adapt to it.
Mitt Romney’s core claim on the economy initially was that Obama had made the recession worse. But improving economic conditions then forced him to reshuffle his message. He began acknowledging that, okay, the economy is getting better, but only in spite of Obama’s policies; things would be better still if it hadn’t been for them.
If this trend continues, the message may need yet another makeover.