- The Washington Times - Saturday, February 5, 2005

Nonfarm payroll employment increased by 146,000 jobs in January, while the unemployment rate declined to 5.2 percent. That is the lowest rate since September 2001. In its report on the job market for January, the Labor Department incorporated major revisions for the nonfarm payroll surveys dating back to 2000. With these revisions, we now have nearly all the data we need to review the employment situation throughout President Bush’s first term.

The nonfarm payroll survey for January reveals that Mr. Bush’s first administration ended with positive job growth, though just barely. Total nonfarm employment increased by 119,000 jobs between January 2001 and January 2005. Technically speaking, however, net nonfarm employment actually fell by 27,000 through the first 47 months of Mr. Bush’s first administration; and then it increased by nearly 150,000 in January 2005 to produce the net gain of 119,000 nonfarm jobs (or 0.09 percent) for the four-year period. That percentage increase is by far the smallest of any four-year administration since Herbert Hoover’s term ended in 1933. The household employment survey, which shows greater net job growth during the last four years than the payroll survey, also confirms that job creation has been the poorest since Mr. Hoover.

This tiny increase in overall nonfarm employment, moreover, was entirely made possible by a net increase of 879,000 jobs (4.2 percent) over four years in the government sector, where all the job growth occurred at the state and local levels. Private nonfarm employment actually declined by 760,000 jobs (minus 0.7 percent) during the first Bush administration.

It is also clear that the economy fell far short of the administration’s job-creation forecast for 2004, during which the average monthly employment level was projected to increase by 2.6 million over 2003’s. In fact, average monthly nonfarm payrolls increased by less than 1.5 million in 2004. The same forecast that projected an increase of 2.6 million jobs in 2004 also predicted that 2005’s average monthly payrolls would rise by another 3.6 million jobs. However, the job-growth forecast for 2005 has recently been slashed to 2.1 million. In other words, compared to the 6.2 million increase in average monthly nonfarm payroll jobs the administration forecast for 2004-2005 in the 2004 Economic Report of the President, the latest projection calls for only 3.5 million net new jobs over the same two-year period.


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