The January jobs report showed a paltry increase of 113,000 new jobs. ( Since choosing not to work is a plus with this administration I don’t know whether they view this as 113,000 happy new workers or 113,000 saps lured into the workforce when they could be writing poetry at home.)
Economist Doug Holtz-Eakin observes, “After a November report that was strong from stem to stern, December and January have been disappointing. Average weekly hours in January were unchanged, and earnings were up modestly, so the foundations of income growth remain shaky at best. The labor force participation rate rose by 0.2 percent (but is still very low) and the household survey showed an employment rise — taken at face value this argues against the notion that those losing extended UI simply dropped out of the labor force.”
The administration is caught between two sets of spin. On one hand it defends its recovery (which, you will recall, is statistically inferior to previous ones) and touts all the people getting back to work. On the other hand, thanks to White House economic adviser Jason Furman, it has now adopted the posture that lost work and work hours is a benefit. So which is it — or is there a Goldilocks number which represents not too many and not too few jobs?
As the ad says, more is always better when it comes to jobs. That is the dilemma the administration has now created for itself. It cannot from a political or economic standpoint argue that taking able-bodied workers out of the economy is good for wages, growth or wealth creation. And yet the president’s signature legislative accomplishment forces it to do just that. Wouldn’t it be easier to give up the ghost, set about replacing Obamacare and kick the economy into high gear? That is the no-brainier argument Republicans will make in 2014 — and why they are increasingly optimistic about taking the Senate.