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Sunday, October 16, 2011

Unemployment Rate When Bush Left Office: 7.7% or 7.2%?

What was the unemployment rate when Bush left office?  7.2% or 7.7% (or 7.8%)?  Read below....

What Was the Unemployment Rate When Obama Took Office (compared to now)? August 2015 update HERE




Debunking the Republicans:  I've recently come across several quotes in right-wing blogs and publications (such as the National Review) claiming that the unemployment rate was 7.2% when George W. Bush left the White House and Obama entered in January 2009.

I didn't understand where this figure came from, as I KNEW the unemployment rate was already at 7.7%* when Obama took the oath of office.  I carefully read through the monthly BLS employment situation reports, and I've looked at those January 2009 figures many times.  (If you go to the BLS link, look at Table A-1 for the January 2009 number.  As numbers are revised over a period of months, again after the first of the next year, up to five years after a particular month,  I always use the most recent revision available as that is the most accurate. In this case, I use the January 2009 figure that is posted a year later, in January 2010.)  
* Update 2/1/2012: Based on the latest BLS revisions, the unemployment rate was  already up to 7.8% when Obama took office.

Why is this important? 

Well, the Republicans want to paint Obama's record on jobs in the worst possible light.  And the Democrats want to paint his record on jobs in the best possible light.  That only makes sense, no matter on which end of the political spectrum you find yourself.

Millions of jobs were lost before Obama took office; nobody disputes that.  The Republicans, however,  often play the "Democrats in Congress" blame game, even though jobs in certain sectors (construction) started declining in mid-2006, as the housing sector started its steep decline, and before the Democrats were voted into Congress in November 2006.   

But, in most sectors, the number of jobs continued increasing until late 2007 or early 2008.  The peak of non-farm jobs payroll numbers was attained in December 2007 (seasonally adjusted numbers)  with 138,119 jobs.
 *Update 2/6/2012:  The peak of non-farm jobs payroll numbers has been revised to 138,023,000 in January 2008 since this article was originally written.
So how many jobs were lost by January 2009 when Obama took the oath of office?  Job loss through December 2008 goes in the George Bush job loss column without dispute.  In December 2008 there were 135,074,000 jobs.  Over 3 million jobs were lost in 2008.    

Between December 2008 and January 2009 700,000* jobs were lost.  Also, the unemployment rate was 7.2% in December 2008 and 7.7% in January 2009.  This is the crux of the controversy.   Who gets the "blame" for those January 2009 numbers?  Some right-wingers give all of January 2009 to Obama.  They claim the 700,000 jobs lost during January go in the Obama column, even though Obama wasn't inaugurated until January 20, 2009.  They also claim that the 7.2% unemployment rate from December, and not the 7.7% unemployment rate of January, is where the Bush legacy ends.

Some say that, since Obama was inaugurated on January 20th, he should get "the blame" for one-third of those January job losses, while Bush gets two-thirds of those job losses in his column. 
*Update 7/2012:  The latest revisions to 2008 and 2009 jobs numbers show that 818,000 jobs were lost in January 2009, not 700,000.

Not so fast, Republicans. 

However, the jobs and unemployment numbers that come out the first week of the next month are NOT based on job numbers at the END of the particular month.  They are based on job numbers as of the WEEK OR THE PAY PERIOD CONTAINING the 12th DAY of the MONTH.  I'm not sure why the 12th day is used by the BLS, but it has been that way for many, many years.  Now Obama was not in office on the 12th of January, so any jobs lost or gained between the week containing December 12th and the week containing January 12th must belong to Bush.  Therefore, Bush gets "blame" for those 700,000 (revised to 818,000) jobs lost in January 2009.  

I also use the 7.7% number vs. the 7.6% number as the most recent revision of jobs/unemployment numbers is the most accurate.  The 7.6% number was the preliminary number issued during the first week of February; the 7.7% number is found in the revised numbers posted in January 2010.  (Note:  The unemployment rate for January 2009 has been subsequently revised to 7.8%.)  

Subsequent revisions (added 2/5/2012):  


I had a discussion with a gentleman who blogs at Reflections of a Rational Republican a few months back.  The blogger acknowledged that the preliminary numbers were taken from numbers reported to the Bureau of Labor Statistics as of the week of the 12th day of the month, as discussed here, but he also was wondering if those early numbers are only "placeholders" for numbers later reported as of the end of the month.  I did check this out at the BLS website.  The preliminary numbers do appear to be "placeholders", but they are placeholders for the data reported using the SUTA state unemployment tax reports.  The actual unemployment report, which is available online, asks for numbers as of the week containing the 12th day of the month.  So, yes, the jobs numbers are provided as of the week containing the 12th day of the month, whether they are preliminary or final.


I read something new today, and this from a person who appears to be more of a Democrat.  This person, writing in response to an Ezra Klein article at the Washington Post, claims that Obama's jobs numbers started from the February numbers.  In other words, as the private sector jobs number for February 2009 was 110,260,000 and the private sector jobs number now is 110,436,000, we now have more private sector jobs than when Obama was inaugurated.  Specifically, he wrote:
  • Peak Private Sector Employment - Jan 2008 - 111,647,000 
  • At Feb 2009 (first Obama Month) - 110,260,000 
  • At Jan 2012 (current month) - 110,436,000  
  • Hmmm, so we've up 176k private sector jobs but still down 3,662,000 lost during the Bush administration.   
Well, no, that isn't quite right either.  As I replied:
... but there were 110,985,000 in January 2009, which should be the starting point for looking at Obama's jobs numbers. The jobs numbers for any month are based on payroll data as of the week containing the 12th day of the month. Therefore, for the week containing January 12, 2009, the week before Obama took office, there were 110,985,000 private sector jobs. Between January 12, 2009 and February 12, 2009, a whopping 725,000 jobs were lost. It seems silly to put those job losses in Obama's column, as he barely had time to breathe between January 20th and February 12th, but officially that loss of 725,000 jobs came under Obama's watch. In any event, we are very, very close (or equal) to the number of private-sector jobs that we had when Obama took office. Now, as you said, we have to make up that 4,662,000 jobs lost in the final year of the Bush administration.

    2 comments:

    1. This comment has been removed by the author.

      ReplyDelete
    2. I unfortunately had to delete the comment of an idiot earlier today. He raised a good issue, which I will address in a blog entry tomorrow. I do not delete oppositional posts, but I do delete those in which the person posting comments calls names or makes spurious accusations.

      But I will post his question with appropriate edits:

      "I'm so glad you mention the year of losses starting near the end of 2007...that is, when Democrats took complete control of the House and the Senate (2/3 control of government).

      ... (Name calling edited here, also accusations that what I post is not based on facts. Mr. Anonymous continues:)

      Facts such as this:

      (quote from msnbc.com:

      NBC, msnbc.com and news services
      updated 11/9/2006 3:12:10 AM ET

      2006-11-09T08:12:10

      - WASHINGTON —
      Democrats wrested control of the Senate from Republicans Wednesday with an upset victory in Virginia, giving the party complete domination of Capitol Hill for the first time since 1994"

      My quick reply:

      In short, the housing bubble had already burst by November 2006, and many economic indicators, including housing prices, housing starts, and employment in some sectors were already on their way down. More later...

      ReplyDelete

    I appreciate intelligent comments and questions, including those that are at odds with anything posted here. I have elected not to screen comments before they are published; however, any comments that are in any way insulting, caustic, or intentionally inflammatory will be deleted without notice. Spam will also be immediately deleted.