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Two Charts Show Trump's Job Gains Are Just A Continuation From Obama's Presidency

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© 2018 Bloomberg Finance LP

There has been a fair amount of rhetoric about the job growth and lower unemployment rate seen since President Trump took office. Candidate Trump touted that there would be 25 million jobs created over 10 years if he was elected. In January 2017, I wrote that this was a fairly easy campaign promise when you analyze the data and realize that it will only take 2% annual growth of the workforce to hit this target.

This is a review of Trump’s Economic Scorecard before the midterm elections.

President Trump started with a distinct advantage with a workforce of 145.7 million, 9% larger than when President Obama took office. If the workforce were to only grow by 2%, that would add just over 2.9 million jobs a year or 243,000 per month. Over the course of 10 years, there would be over 29 million jobs added.

Additionally, over President Obama’s last six and five years in office after the economy had recovered from the Great Recession, the average employment gains were 2.42 and 2.48 million jobs per year. Pretty much on track to add 25 million over 10 years. So it appears that Trump can reach his 25 million job growth goal even if the economy continued to grow at the pace under Obama .

To provide a monthly comparison, the average employment gain in Obama’s last six years in office (after getting out of the recession's impact) was 201 thousand. And the average for his last five years was 207 thousand, essentially the same as the 208 thousand for the first nine months this year.

This is an update using the October jobs report.

Over 2 million jobs added per year for the past 8 years

Below are the employment gains from President Bush’s last four years in office from just before the start of the Great Recession, through President Obama’s and so far through President Trump’s tenure.

Bush’s last four years in office:

  • 2005: 210,000 per month or 2.52 million for the year
  • 2006: 175,000 per month or 2.09 million
  • 2007: 96,000 per month or 1.15 million
    • Last six months averaged 55,000 per month
  • 2008: Negative 297,000 per month (recession takes hold)
    • Lost 3.6 million jobs

Obama’s eight years:

  • 2009: Negative 422,000 per month

    • Lost 5.1 million jobs (teeth of the recession)
  • 2010:  88,000 per month or 1.05 million for the year
  • 2011: 174,000 per month or 2.09 million
  • 2012: 179,000 per month or 2.14 million
  • 2013: 192,000 per month or 2.3 million
  • 2014: 250,000 per month or 3 million
  • 2015: 226,000 per month or 2.7 million
  • 2016: 187,000 per month or 2.24 million

Trump’s through September:

  • 2017: 182,000 per month or 2.19 million
  • Through September 2018: 208,000 per month or 2.5 million run rate

Graph courtesy of Joel D. Shore, based on employment data from the U.S. Bureau of Labor Statistics

Unemployment rate has been dropping for 9 years

The unemployment rate shows pretty much the same progression from President Obama to President Trump . The unemployment rate started to climb the last two years of President Bush’s second term and substantially in Obama’s first year as the Great Recession that he had inherited was having a huge impact.

Bush’s last four years in office:

  • December 2005: 4.9%
  • December 2006: 4.4%, decreased 0.5%
  • December 2007: 5.0%, increased 0.6%
  • December 2008: 7.3%, increased 2.3%

Obama’s time in office

  • December 2009: 9.9%, increased 2.6%(teeth of the recession)
  • December 2010: 9.3%, decreased 0.6%
  • December 2011: 8.5%, decreased 0.8%
  • December 2012: 7.9%, decreased 0.6%
  • December 2013: 6.7%, decreased 1.2%
  • December 2014: 5.6%, decreased 1.1%
  • December 2015: 5.0%, decreased 0.6%
  • December 2016: 4.7%, decreased 0.3%

Trump’s through September:

  • December 2017: 4.1%, decreased 0.6%
  • September 2018: 3.7%, decreased 0.4%

The second graph that shows the U.S. unemployment rate continues on essentially the same path even with a slightly higher GDP growth rate (based on trailing four quarters growth).

Graph courtesy of Jack Woida using Federal Reserve Bank of St. Louis, FRED data

The following articles provide information about:

Why Trump and Republican’s have gone radio silent on GDP growth,

How much Trump’s tariffs are impacting consumers and corporations,

That his budget deficits are about to become the largest in history,

His freezing federal wages saves less than the Wall,

Three surveys show plummeting confidence in the economy,

How China could be taking advantage of Trump in trade negotiations and

Fact-checking Trump's State of the Union address.