Is the economic expansion over already? One would think so listening to the talking-heads last Friday after the Labor Department reported that only 1,000 (no, I did not forget any zeros or other digits) jobs were created in December. It pushed the third quarter's +8.2% GDP growth rate into the shadows of distant memory. It does not help that this is an election year, when economic issues are distorted by both sides in an effort to grab the headlines for the day. In light of all that, it's a good time to take a step back and look at where we are in the grand scheme of things. That is the focus of this week's column.

First, job creation reports are always subject to revisionsometimes massive revisions. This is nothing new.

Second, the unemployment rate dropped, from 5.9% to 5.7%, and somehow this important fact got lost in the hyperbole around a jobless recovery. One of the reasons the rate droppedas I have said beforewas due to discouraged job seekers who have been unable to find work and have left the labor force. This essentially lowers the denominator of the calculation. This is not surprising; during an economic recovery, unemployment rates go up as more people look for work, and the potential labor force can shrink temporarily as some workers decide to wait for the right job to come along rather than taking the first job that comes their way, especially if there is another wage earner in the household that is benefiting from the recovery. Also, tax cuts, such as the child credit increase, were specifically designed to enable households with child-rearing responsibilities to have an adult stay at home or at least work fewer hours. For many families at the low end of middle class, taxes paid can exceed food expenditures. This is an economic, not a social, commentthere are many factors that affect the unemployment rate that are not always obvious at first glance.