COMMENTARY | The latest unemployment numbers for November are in and, on the surface, they constitute good news for the nation and for President Barack Obama. Bu there is less to the sudden drop to 8.6 percent than meets the eye.
According to a story in CNBC, the drop from 9.0 percent to 8.6 percent can be explained by two figures. First, 120,000 new jobs were created in November. The rest of the drop can be explained by 315,000 people simply dropping out of the work force, having given up ever finding a job for the foreseeable future.
In another bit of bad news, 402,000 people signed up for unemployment in the previous week, also according to CNBC.
While any drop in the unemployment statistics, no matter what the cause, will derive some political benefit for President Obama, or at least bragging rights, it has not pointed to an overall improvement in the economy. The turmoil in Europe is still a threat. Obama administration policies still inhibit job growth.
According to Rea Hederman of the Heritage Foundation, writing for National Review, the news is merely good and not great, but with some anomalies that are of concern. A lot of the drop in employment participation is in adult women. This is a prime constituency for the Democratic Party and for President Obama. Unemployed people who are too despairing to look for work tend to take their frustrations out on the party in power.
The upshot is that Obama and his people will boast about the statistic, albeit in a muted fashion, with qualifiers, and exhortations that more must be done. Obama's opponents will counter that any job growth that is happening in anemic, inhibited by Obama's policies, and could be easily reversed by bad economic news that can come at any time.
Thus, the political wrangle over how to grow the economy will continue, including whether or not to increase taxes on "the rich" and on regulations and spending.
A couple of other statistics for Obama and his men to chew over, courtesy of Data360. The unemployment rate for Oct, 1980 was 7.5 percent, the month before Ronald Reagan defeated President Carter for reelection, In Oct 1992, it was 7.3 percent, the month before Bill Clinton toppled President Bush the Elder. Both are over a percentage point lower than the current number.
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