Friday, the government reported that the US economy added 517,000 non-farm jobs in January, far more than the average 183,000 predicted by economists. Job creation was so strong that economists are worried that the Fed will continue hiking interest rates to cool the economy down and rein in inflation. But the high jobs number baffled many analysts, considering the obvious problems with the economy. That didn’t stop President Biden from taking credit for it and declaring that his mysterious “economic plan” was responsible for this miraculous level of job creation.
Well, as Detective Columbo might say, “Nah, that can’t be it.” For me, this news echoed back to the Obama/Biden years, when they took credit for any modest gains in the struggling economy. My analogy then, once again relevant now, was that the US economy was like an Olympic swimmer and their economic policies were like a concrete block hung around his neck. If the swimmer was so strong that he could still tread water, they’d try to give credit for that to the concrete block.
But Ben Whedon at JustTheNews.com may have solved the mystery of how there could be that many jobs created with Biden at the helm. You won’t be surprised to learn that it’s another example of the old axiom that there are three kinds of lies: “lies, damned lies and statistics.” In this case, it’s the third.
The big “gain” in new jobs may be largely an illusion caused by three things: a rise in government employment, people returning to work after the end of a university workers’ strike, but most importantly, many big companies had announced major layoffs (12,000 from Google, 17,000 from Amazon, etc.) that were factored into the January numbers, but that are taking longer than expected to put into effect. One economist told CNBC that the big “jobs created” number “is not really the number of jobs created, but how many fewer workers were let go" than expected. In other words, it's not that it's much better than expected, just that it's not as bad as expected, yet.
If there’s another month or two with very high job creation numbers, that might be an indication that the economy really is booming. But I wouldn’t bet your double-mortgaged farm on it.