Stimulus Spending And Job Growth: Update 19
Well, it's that time again (actually well past that time). Time to update Obama's stimulus-driven job creation results. For the month of December, there was a net gain of 103,000 jobs. That's bad news for President Obama, because it's once again lower than analysts had predicted. October and November's job figures were revised upwards slightly according to the latest data from the US Dept of Labor.
Barack Obama said his stimulus package would create approximately 4 million "new" jobs over two years. In order to create 4 million jobs in 24 months, the Obama administration would have had to create approximately 166,667 jobs per month to reach his target, assuming linear job growth. That scenario is shown as violet in the following graph.
I developed a curve showing what I thought might be a more "Likely" scenario -- plotted as light blue in the following graph. As you can see from the graph, the actual trend was somewhat worse than I had predicted -- plotted as yellow and red. The trend generally followed the trajectory I had originally envisioned until about May of this year (Month 15). Since then, job growth has been essentially anemic.
Instead of having to create 166,667 new jobs per month to reach his original target of 4 million new jobs, President Obama now needs to create 2,817,000 jobs per month -- in order to make up for the nearly 2 million jobs that were lost since the stimulus bill was signed.
According to US DOL statistics, the official unemployment rate dropped to 9.4%, because the number of people looking for work dropped from 15.1 million people to 14.5 million. In other words, 556,000 people dropped out of the work force. This is on top of the 2.6 million people who were already "marginally" attached to the work force because they did not actively seek work during the last month and therefore were not included in the numbers. And there were another 8.9 million people who were working part-time because their hours had been cut or because they could not find a full-time job.
However, I am pleased to report that I no longer remain unemployed. After 15 months of unemployment, I am once again a "productive" member of society. My prayers go out to those who are still looking for work.