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New Column up at Real Money: Rethinking the ‘Strong Jobs Recovery’ Scenario (12/21/05)

Posted By Barry Ritholtz On December 21, 2005 @ 12:18 pm In Economy,Psychology | Comments Disabled

RealMoneyAn expanded version of an earlier commentary [1] is up on both The Street.com (no subscription req’d) and Real Money, titled Rethinking the ‘Strong Jobs Recovery’ Scenario [2].

You will no doubt recognize many of these points discussed previously.

Here’s an excerpt:

"Job creation is crucial to any economic expansion. It directly affects consumer spending, and it’s one of two key factors determining the health of real estate (the other being interest rates). One cannot overstate the importance of job creation to the economy.

Lately, the White House and Treasury Secretary John Snow have been trumpeting the fact that the economy has created 4.4 million new jobs since May 2003.

Inquiring minds want to know: How legit is that number? How was it derived? How does this job-creation data compare to prior cyclical recoveries?

Let’s zoom in on the actual employment numbers and see what’s there."

Lots of contrary stuff here . . .

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UPDATE:  December 23, 2005 10:48am

David Altig [3] correctly alerts me to an error in the column:  According to the NBER, the most recent economic peak occurred in March 2001, ending a record-long expansion that began in 1991. The most recent trough occurred in November 2001. (I regret the confusion).

This changes some of the math: From the beginning of the recession to last month, about 1.8 million jobs were created. Measured from the end of the recession, we see 3.4million new jobs. Measured from March 2003, we see the 4.4 million new jobs. None of these measures take into account the 2.6 million jobs lost from 2001 to 2003.

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Source:
Rethinking the ‘Strong Jobs Recovery’ Scenario [2]
RealMoney.com, 12/21/2005 7:09 AM EST
http://www.thestreet.com/_tscana/markets/economics/10258387.html


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2005/12/new-column-up-at-real-money-rethinking-the-strong-jobs-recovery-scenario-122105/

URLs in this post:

[1] commentary: http://bigpicture.typepad.com/comments/2005/12/how_strong_is_t_1.html

[2] Rethinking the ‘Strong Jobs Recovery’ Scenario: http://www.thestreet.com/_tscana/markets/economics/10258387.html

[3] David Altig: http://macroblog.typepad.com/macroblog/

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