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Economy Sending Conflicting Messages? Or Is It?

“Just because you can, doesn’t mean you should” is the way the saying goes, and claiming some credit for a good job report on Friday was probably not wise. That old political rule of claiming credit for what happens on your watch though not caused by you has the underside of getting the blame for what you did not do. An important GDP forecast shows a very weak Q1, and the content creation businesses of advertising and design had declines in employment. Perhaps some weak economic conditions are what’s needed to get the Beltway’s priorities into the right order.

Monday, March 13, 2017

One of the rules of politics should be to never claim credit for any particular economic data report: they always come back to get you. It’s also a rule of politics that you take credit for the good things that happen on your watch (whether you’re watching or not). The trick is to know the difference, or to have an ability to “not recall” when the data turns against you for whatever reason. Claiming that the rise is the effect of new policies means that there has been a sea change from recent volatility trends. Sorry, no. What happens on your watch was not necessarily caused in your watch, but it is a rule of politics. But there should be some judicious application of such rules.

Friday’s employment report was generally good from the payroll perspective (+235,000), and very good from the household survey vantage point (+447,000). But that payroll increase was slightly worse than that of last year. That’s not an improvement.

The labor participation rate hit 63%, but it was there in May 2016 as well, and has been at 63.1% only once in the last three and a half years. In September 2015 it was 62.4% and it have been bouncing to this mild improvement since then, with May 2016 being the peak. So it’s no big deal to be stuck at the same level not seen since the late 1970s.


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About Dr. Joe Webb

Dr. Joe Webb is one of the graphic arts industry's best-known consultants, forecasters, and commentators. He is the director of WhatTheyThink's Economics and Research Center.

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