Obama, Romney camps ready for jobs report

By Vicki Needham - 07/05/12 05:05 PM ET

All eyes in Washington will be on the June jobs report Friday, which is expected to show employers added about 125,000 jobs for the month.

Such a figure would be relatively good news for President Obama’s campaign, which endured a rocky two weeks after May’s report found the economy added a mere 68,000 jobs.

Obama is in the middle of a two-day bus trip through the key swing states of Ohio and Pennsylvania, but his trip would be overwhelmed in the news cycle by a negative jobs report.

The economy is the biggest issue in the campaign between Obama and Republican Mitt Romney, a fact acknowledged by both parties.

Mark Zandi, chief economist at Moody's Analytics, expects private companies to add 125,000 jobs but for the unemployment rate to remain unchanged at 8.2 percent.

He said he expects job creation to proceed at a faster pace this summer than in the spring, though he offers the forecast with “significant trepidation given that I’ve been too optimistic in the past several months.”

Several reports released Thursday offered signs of improvement in the jobs market.

First-time weekly claims for unemployment benefits dropped to the lowest level since May, while payroll provider ADP said private-sector businesses added 176,000 jobs to their payrolls in June, better than the revised total of 136,000 jobs for May.

Goldman Sachs announced Thursday they had upgraded their forecast to 125,000 up from 75,000 because of several pieces of good economic news, including the improved initial claims report.

While Obama faces a difficult economy, the states he is touring Thursday and Friday have lower unemployment rates than the national average. Unemployment in Ohio and Pennsylvania is 7.3 percent and 7.4, respectively.

Keith Hall, former BLS commissioner and an economist at George Mason University, said that while an uptick in the national numbers might seem like good news compared to previous months, “it’s still not enough for real recovery.”

“Jobs growth hasn’t improved at all since the Great Recession, because the real unemployment rate is still lagging at around 13 percent,” he said.

Hall said the economy needs job growth above 130,000 to simply keep up with the working-age population of new graduates entering the labor force minus the number of those retiring.

No president since Franklin Roosevelt has been reelected with a jobless rate above 8 percent. Obama would love to see the figure drop below 8 percent, but many economists consider this unlikely by November given troubles in the global economy.