Originally posted at Business & Media Institute by Julia A. Seymour
A senior political adviser to the Obama administration said on July 6 that in 2012, people won’t be voting based on the unemployment rate, according to The Hill newspaper.
Of course, adviser David Plouffe said that two days before the June jobs report was released. Ahead of the jobs report, economists anticipated 100,000 or 125,000 jobs to have been added that month. Truth be told, on July 8, the jobs report showed only 18,000 jobs added and plenty of other “lousy” news.
The unemployment rate also rose to 9.2 percent in June, and April and May data was revised to show 44,000 fewer jobs. The real unemployment rate (the figure including discouraged workers) also went up to 16. 2 percent.
Job gains of only 18,000 in June were dramatically lower than most estimates, even Rick Santelli’s (who came within 1,000 from the data last month). He gave the lowest estimate of all the CNBC panelists just before the Bureau of Labor Statistics report came out.
The numbers “stunned” economist Mark Zandi who was on that CNBC panel of guests as the June report came out. Zandi said the report calls into question the “rebound later in the year.” Another panelist, economist Diane Swonk said that “any way you cut this data it’s lousy.”
Plouffe claimed (as quoted by Bloomberg), “The average American does not view the economy through the prism of GDP or unemployment rates or even month jobs numbers.”
“People won’t vote based on the unemployment rate, they’re going to vote based on: ‘How do I feel about my own situation? Do I believe the president makes decisions based on me and my family’,” Plouffe continued.
The Hill quoted Zandi’s estimate of 110,000 job gains in June and his prediction that “payroll employment gains [will be] back near 200,000 by the end of the year.” The Hill wrote, “If Zandi’s right and those gains continue through 2012, Plouffe might be proven right, too, as voters could be pleased with their position.” According to AOL’s Politics Daily, Zandi “has advised candidates of both parties, including Obama …”
But following the awful June jobs report, Zandi acknowledged on CNBC that a turnaround in the second half of the year is now in question and he might be forced to downgrade his expectations.0 Recommend This