President Joe Biden claimed the first two years of his presidency marked record job growth following Friday’s employment report. Here are the facts about his job record and how it stacks up with that of the previous three presidents.
The economy gained 223,000 jobs in December, the Bureau of Labor Statistics reported Friday morning, a strong number that shows the labor market has remained resilient even as the Federal Reserve drives up interest rates to tame inflation. The unemployment rate also dipped to an ultralow 3.5%.
After the report, Biden claimed to have set a record on job creation. “We have just finished the two strongest years of job growth in history,” he said in a statement. “And we are seeing a transition to steady and stable growth that I have been talking about for months.”
Biden’s statement is correct. But there are at least two major caveats worth noting.
Before getting to those qualifications, though, here are the numbers: With that December number now official, although still subject to revision in the coming months, it means that since the December before Biden was sworn in, some 11.2 million jobs have been created on a non-seasonally adjusted basis. (Note, though, that Biden was not president for most of January 2021, when he was sworn in.) That’s the most for any two calendar years on record.
There are two important items of context to note. The first is that Biden’s presidency began in a pandemic-induced trough for the labor market. When Biden was first sworn in, many people were still jobless because their employers were closed or because they were refusing to go to work for fear of contracting the coronavirus. Job creation since then largely reflects businesses reopening and workers returning to the labor force, a process that was well underway when Biden came into office.
The second is that the economy has not yet returned to the pre-pandemic trend. The country is still perhaps several million jobs short of what was expected before the coronavirus struck.
Here’s the math: The establishment survey from Friday’s report showed that the total employment level was 153.7 million. The Congressional Budget Office projected in January 2020 that there would be 155 million non-farm payrolls by the end of 2022. The difference is 1.3 million jobs. Another way of looking at it is that the overall employment-to-population ratio stands at 60.1%, according to the household survey in Friday’s report, versus 61.1% in February 2020.
Still, Biden can claim a higher rate of job growth than the three most recent modern presidents.
During President George W. Bush’s first two years, 2.3 million jobs were lost. The economy was suffering from a recession brought on by the collapse of the dot-com bubble and the 9/11 terrorist attacks.
Former President Barack Obama was also sworn in at a time of economic turmoil. The Great Recession began about a month before he was sworn in, and his first two years featured a flailing labor market. In the first two years of Obama’s presidency, 4.1 million jobs were lost, although the economy had already begun recovering.
Unlike Bush and Obama, former President Donald Trump’s first two years in office were marked by an economic expansion. A total of 4.6 million jobs were added through the end of 2018.
The final jobs report of 2022 is a bit of a double-edged sword, though. While full employment is the goal of every administration and the Fed, the central bank has a dual mandate and must also respond to inflation.
Inflation as gauged by the consumer price index is still punching in at 7.1%, below peaks experienced last year but still magnitudes higher than the Fed’s 2% level. As a result, the Fed has been hiking interest rates at a historic pace in order to slow the economy and drive down inflation.
Fed officials have said some job loss will be necessary in order to bring down inflation, so the report showing a strong labor market means the Fed might have to continue jacking up rates — a prospect that economists fear could tip the economy into a recession.
Other recent economic reports have bolstered Friday’s strong employment report.
Last week, jobless claims fell to the lowest level in months, with applications for unemployment benefits falling by 19,000 to 204,000. Additionally, job openings in November decreased by less than most economists had expected.
Reporting from The Washington Examiner.
