With the U.S. jobless rate falling below 8 per cent for the first time since the first month of Barack Obama’s presidency, Republicans scrambled to put a negative spin on September’s drop to 7.8 per cent. Some even suggested the numbers were cooked to help Mr. Obama’s re-election bid.
No President since the Depression Era has won re-election with an unemployment rate above 7.2 per cent. Ronald Reagan won with a 7.2 per cent rate in 1984, after seeing the jobless rate decline from a peak of 10.8 per cent almost two years earlier.
Under Mr. Obama, unemployment peaked at 10.2 per cent in October, 2009, and has hovered stubbornly above 8 per cent for most of this year. The drop below that psychological mark, with only one month and one more labour report before the election, was suspect in the eyes of some.
For former General Electric chief executive Jack Welch, a Mitt Romney supporter, the drop below the 8 per cent barrier showed how Mr. Obama’s campaign operatives “will do anything” to win the Nov. 6 presidential election.
“Unbelievable jobs numbers…these Chicago guys will do anything…can’t debate so change numbers,” Mr. Welch, 76, tweeted after the Labor Department reported Friday that the jobless rate dropped last month to its lowest level since January, 2009.
Mr. Welch’s intervention set off a flurry of denials by Obama administration officials – noting the number crunchers at the Bureau of Labor Statistics are insulated from the Labor Department’s political staff – and duelling tweets from both sides.
“Love ya Jack but here you’ve lost your mind,” University of Chicago economics professor Austan Goolsbee, the former chairman of Mr. Obama’s Council of Economic Advisers tweeted in response to Mr. Welch.
The jobless report deprived the Republican nominee of one of his most reliable talking points. Until Friday, Mr. Romney’s stump speech contained a reference to the number of consecutive months the unemployment rate had been above 8 per cent. August marked the 43 rd straight month of unemployment above that level.
On Friday, Mr. Romney said the “disappointing unemployment rate is not what a real recovery looks like. We can’t afford another four years like the last.” He added that the “real unemployment rate” was closer to 11 per cent because so many Americans have given up looking for a job.
The BLS reported that the unemployment rate dropped from 8.1 per cent, even though only 114,000 new jobs were created in September while 418,000 people entered the labour force. The federal agency also revised the July and August jobs numbers upwards by a total of about 90,000.
“The economy has now added private sector jobs for 31 straight months,” current Council of Economic Advisers chairman Alan Krueger said in a statement. “The economy has added a total of 5.2 million private sector jobs during that period.”
Still, the jobs report also contained some bad news for the administration. The number of Americans who are working part-time because they cannot find full-time work rose to 8.6 million in September from 8 million in August. Manufacturing jobs declined by 16,000 last month, meaning there has been no net job growth in that sector since April.