RUTHFULLY YOURS

We’ve pointed out how President Joe Biden is being purposely deceptive when he brags about creating 13 million jobs. An honest accounting shows the job gains to be more like 3.7 million. But what if even that altogether unimpressive number is itself a wild exaggeration?

Job growth is one of the only things Biden has to justify his reelection. He can’t talk about inflation – it’s still punishingly high. He can’t talk about real wages – they’re falling. He can’t talk about economic optimism – it’s in the dumps. He can’t point to any poll about his handling of the economy – they all give him failing grades. He can’t claim to have unified the country – as our poll this week showed. So, he plays up job creation.

Last week, Biden gave a speech claiming that “Bidenomics is working,” and tweeted out a chart showing average monthly job growth in each of the past seven presidents, with a caption that reads: “My administration has created more jobs in two years than any previous administration has created in the first four years. It’s no accident. It means our economic plan is working and this is only the beginning.”

This is the dictionary definition of lying with statistics.

Data from Biden’s own Bureau of Labor Statistics shows that 72% of the jobs the president brags about weren’t “created,” they were simply reclaiming jobs lost during the pointless COVID lockdowns.

In February 2020, before the lockdowns, jobs reached a new peak of 152.4 million, according to the BLS. By April 2020, that number had plunged to 130.4 million. When Trump left office nine months later, the economy had already reclaimed 12.5 million of those lost jobs. Under Biden, however, it took 17 months to reclaim the remaining 9.5 million jobs lost during the lockdowns.

That is nothing to brag about.

Nor is the fact that the economy has added 3.7 million jobs since then. Think about it. From February 2020 (the previous peak in jobs) through May 2023, the working-age population grew by 7 million, or almost twice the number of new jobs. We are still way behind the eight ball.

Even this mediocre jobs number, we now learn, is probably a wild exaggeration.

Over the weekend, the Wall Street Journal published a story headlined “Labor Market Headfake? Key Report Could Be Overestimating Job Growth.” (This is from the liberal news side of the paper, not the conservative editorial page.) The article notes that payroll data, the same data Biden uses to make his 13 million job boast, might be vastly “overcounting the number of actual jobs, with some economists saying the overestimate could be 77,000 a month.”

The BLS uses payroll data collected from a survey of more than 122,000 businesses and government agencies to calculate the number of jobs in the economy. The latest payroll data showed a gain of 339,000 jobs in May, which prompted Biden to rush out with a statement that “today is a good day for the American economy and American workers.”

The BLS uses a separate survey of 60,000 households to calculate the unemployment rate. That survey showed a drop in “employment” of 310,000 in May, which pushed the unemployment rate up to 3.7%. Biden didn’t mention that number.

Why focus on one but not the other?

“Historically, economists consider the payroll survey a more reliable indicator of labor market health, except at turning points in the economy,” the Journal notes.

That’s because the payroll survey doesn’t include startups or businesses that have failed. So, the BLS uses a “birth-death model” to fill in the gap, which is fine when the economy is humming along and the number of startups and closures is close to the average. But this model can vastly overestimate “births” and underestimate “deaths” when the economy turns south.

“From 2007 to 2010, a period dominated by recession and a weak recovery, the payroll survey overstated jobs by a cumulative 1.7 million, as shown by subsequent, more comprehensive tax data,” the Journal notes.

Jonathan Pingle, chief U.S. economist at UBS, told the Journal “that the level of nonfarm payroll employment at the end of 2022 was likely too high by several hundred thousand, and that the overstatement might have carried into 2023.”

In other words, a significant portion of the new 3.7 million jobs under Biden could also be a fiction, which makes his boast an even more flagrant misrepresentation.

We won’t know what the real jobs picture is today until after businesses file their taxes and more complete jobs data emerge in the years ahead. But we don’t have to wait. Just look at the polls.

Nobody is buying what Biden is selling because they live in the real world.