Tuesday, March 18, 2008

Job Growth Under Bush and Prior Presidents

Note: The following blog entry has been updated at this link:

A March 16th New York Times editorial titled Through Bush-Colored Glasses alleged that Bush painted a false picture of the economy in a recent speech. Following is an excerpt:

Mr. Bush boasted about 52 consecutive months of job growth during his presidency. What matters is the magnitude of growth, not ticks on a calendar. The economic expansion under Mr. Bush — which it is safe to assume is now over — produced job growth of 4.2 percent. That is the worst performance over a business cycle since the government started keeping track in 1945.

I haven't calculated the job growth per business cycle but I have looked at the growth in employment over every presidential term since 1949. The following table shows the monthly average change in population, the labor force, employment according to the Household Survey, total nonfarm employment, and total private employment over every presidential term since 1949, along with the unemployment rate at the beginning of each term:


Monthly Average Change (in thousands)
-------------------------------------------- Unemploy-
Popu- Labor Househld Nonfarm Private No. of ment
President Mo Year lation Force Survey Employed Employed Months Rate
----------- --- ---- -------- -------- -------- -------- -------- -------- ---------
Roosevelt Jan 1941 154.6 117.4 48
Truman Jan 1945 57.8 65.3 48
" Jan 1949 63.9 55.6 71.4 114.0 95.2 48 4.3
Eisenhower Jan 1953 104.8 62.3 42.3 57.1 39.9 48 2.9
" Jan 1957 136.0 83.7 44.7 16.6 -3.1 48 4.2
Kennedy Jan 1961 156.1 65.0 87.9 122.9 94.3 48 6.6
Johnson Jan 1965 159.9 124.0 141.8 205.3 158.0 48 4.9
Nixon Jan 1969 258.3 165.9 132.4 128.8 97.9 48 3.4
Nixon/Ford Jan 1973 249.3 202.5 141.0 105.7 77.2 48 4.9
Carter Jan 1977 237.8 225.4 208.9 215.4 188.2 48 7.5
Reagan Jan 1981 172.5 139.6 132.2 110.9 111.4 48 7.5
" Jan 1985 172.1 180.5 216.8 224.6 194.6 48 7.3
G.H. Bush Jan 1989 173.3 104.4 49.3 54.0 30.5 48 5.4
Clinton Jan 1993 173.4 147.0 192.1 239.7 225.3 48 7.3
" Jan 1997 241.7 173.8 197.5 234.1 208.3 48 5.3
G.W. Bush Jan 2001 228.1 87.1 51.0 0.1 -18.8 48 4.2
" Jan 2005 215.5 145.8 155.9 149.1 132.1 37 5.2
Feb 2008 4.8

Following is a graphical representation of the above numbers:

Additional numbers and the sources can be found at http://home.att.net/~rdavis2/employ08.html. As explained in my post of March 16, one must be careful in comparing changes in employment using the Household Survey. This extends to changes in the population and labor force, also from the Household Survey. Still, the job growth of nonfarm and private jobs (from the Payroll Survey) in Bush's first term was the worst since at least 1941. Taking both of Bush's terms together (through February 2008), the average monthly growth in household survey, nonfarm, and private employment were 96.6, 65.0, and 46.9 thousand, respectively. For nonfarm and private employment, this was the second worst since Eisenhower with Bush's father's term being the worst.

The above graph and table show at least one other interesting fact. They show 15 presidential terms since 1949. In almost every term of a Democratic president, the growth in household survey, nonfarm, and private employment was greater than the growth in the labor force. Conversely, in almost every term of a Republican president, the growth in household survey, nonfarm, and private employment was less than the growth in the labor force. The only three exceptions in the 15 terms were Carter, Reagan's second term and G.W. Bush's second term until now (except for private employment).

A related fact is that the unemployment rate went down during almost every term of a Democratic president and up during almost every term of a Republican president since 1949. This follows from the prior fact because the unemployment rate equals the unemployed (labor force minus the employed) divided by the labor force from the Household Survey. In any case, the only exceptions to this second fact was Carter (when the unemployment rate stayed about the same) and both terms of Reagan and the second term of G.W. Bush (when the unemployment rate dropped). Of course, the unemployment rate is doubtlessly affected by the majorities of both houses and many other facts. Still, this apparent relationship to the party of the current president would seem worthy of some additional study.


Anonymous said...

Looks like the current Bush was handed a .com bust from Clinton and was able to take it from - 18 to over 100+

Weigh this against competing global economies (Europe and Asia) and you can see clearly that Bush has lead the US econony out of a ditch when his counterparts around the world have struggled.

B Davis said...

I agree that job growth during Bush's second term has been much better than during his first term. Still, even that job growth has been no better than average. In any case, I don't think it's any more fair to assign Clinton full blame for the .com bust than it would be to assign Bush full blame for the subprime mess. As I mentioned at the end of the article, the unemployment rate (now up to 5.1%) is doubtlessly affected by the majorities of both houses and many other facts. That is also likely the case with events like the .com bust and the subprime crisis.

Rick Taylor said...

It's important to place things into context. The unemployment rate was already near historic lows when Bush took over. There was little room for improvement.

The Clinton, Bush era of growth was supported by "easy-credit". Most of the easy credit was related to the real estate market.

Everyone has a hand in this economic mess. The easy credit led to inflated expectations.

A more-Balanced Budget Amendment is the only thing that will save the union. "Special Relativity" is my proof.

About Me

I became interested in U.S. budget and economic matters back in 1992, the first time that I remember the debt becoming a major issue in a presidential election. Along with this blog, I have a website on the subject at http://www.econdataus.com/budget.html. I have blogged further about my motivations for creating this blog and website at this link. Recently, I've been working on replicating studies such as the analysis at this link.

Contact Me


Email *

Message *