February’s jobs report “smashed expectations.” That’s how one news site described the latest monthly employment numbers out of the Commerce Department, which showed the economy created 273,000 jobs last month. Smashing expectations has become a regular feature of the Trump economy. Anyone care to guess why?
Based on the consensus forecast of economists, the first two months of this year should have seen a total of 335,000 jobs created. The actual number was 63% higher: 546,000.
For the past four months, job growth has averaged 248,000, after the Bureau of Labor Statistics revised several previous months’ gains sharply upward. In the best year under President Barack Obama, job growth averaged 250,000 a month.
The current job growth is even more impressive given that it’s coming more than 10 years after the last recession ended, and long after the experts told us we were already at full employment.
There’s more. To get a full picture of how much better than expected the Trump economy is performing, take a look at the forecast put out by the Congressional Budget Office just as Trump was taking office in January 2017.
According to the CBO, which based its forecast on the assumption that the economic policies of the Obama administration remained in place, the economy should have created only 2 million new jobs by this point.
The actual number: 6.9 million.
GDP growth has outpaced the CBO’s prediction in each of the past three years, resulting in an economy that is $600 billion bigger than it was supposed to be. Unemployment, which the CBO expected to be on the rise by now, fell back to 3.5% last month. Wage growth has done better than expected, without triggering inflation.
Then there were the constant warnings of a Trump recession.
Last August, the liberal “explanatory journalism” site Vox.com headlined an article “Why everybody’s worried about a recession again.”
In December 2018, the Washington Post ran a piece headlined: “A recession is coming, Trump will make it so much worse.”
That article reported that “virtually every independent forecaster foresees a slowdown once the sugar rush of Trump’s tax cuts wears off in the next year or so. And in a recent survey of economists by the Wall Street Journal, more than half predicted that we’d have a full-blown recession by 2020.”
Three days int 2017, PBS ran a column titled: “I’m predicting an economic recession in 2017. Are you ready?”
Around the same time, CBS Marketwatch posted an opinion piece warning that the “Next recession will hit during Trump’s first two years.”
Even more recent economic forecasts keep coming up short. The Atlanta Fed’s GDPNow, which provides real-time estimates of the current quarter’s GDP growth based on available economic data, is at 3.1%, with less than a month to go in this quarter. The most recent Blue Chip consensus has Q1 growth at under 1.5%. Even with a coronavirus-induced slowdown, it’s very possible Q1 will come in well above that number.
This is all, it should be noted, a dramatic turnaround from the Obama years.
Then, the press was all about “green shoots” and economists kept predicting the economy was poised to lift off. Strong growth was “right around the corner,” they kept saying, and soon we’d see the fruits of Obama’s tax-and-spend-and-regulate economic policies. Yet actual results routinely come in “unexpectedly” worse. GDP growth was below forecast every single year Obama was in the White House.
The only thing surprising about the “unexpectedly” good economic reports during Trump’s time in office isn’t how often economists get it wrong. It’s how little coverage any of it gets. When not ignoring the economy, the press has tried valiantly to either downplay the gains, or issue constant warnings of doom.
Sometimes it even seems as though the press is taking sides.
— Written by John Merline