By Ian Swanson - 03/30/10 05:09 PM EDT
The economy is expected to have added hundreds of thousands of jobs in March, bolstering the Obama’s administration’s arguments that the $787 billion stimulus package is working.
Private forecasts on the unemployment report to be released on Friday predict as many as 200,000 jobs will have been created in March.
Economist Mark Zandi, who advised Sen. John McCain (R-Ariz.) during the 2008 campaign and Democrats during the crafting of the stimulus, projects that 175,000 jobs will have been created.
Zandi’s estimate is that 100,000 of those jobs were created by the Census Bureau, which is hiring hundreds of thousands of workers to go door to door to get people to fill out their censuses.
Another 50,000 jobs are a bounce-back from February, when Zandi and other economists believe harsh winter storms contributed to lower-than-expected hiring. The economy shed 36,000 jobs in February, according to the Bureau of Labor Statistics.
Either way, the numbers will provide a jolt of good economic news for President Barack Obama, who is already enjoying the fruits of Democrats’ healthcare victory.
If the economy did add 175,000 jobs, it would be the most jobs created since March 2007, when the economy added 239,000 jobs.
Democrats nervous about the fall elections want to push the storyline that their efforts with the stimulus helped stave off a new Great Depression, and that an economy that lost nearly 3.7 million jobs in the months immediately following Obama’s election is now moving forward.
The March figures would boost that narrative, but there are several clouds on the horizon.
It’s unclear whether the 9.7 percent unemployment rate will drop at all, even with the positive job numbers.
Heidi Shierholz of the Economic Policy Institute says the rate could stay at 9.7 percent or even jump to 9.8 percent. The reason is workers who gave up looking for jobs are now coming back to the workforce.
Also, the help from Census hiring is a temporary boost at best. Most Census workers will only be employed for a matter of months.
That means it could be a cruel summer for Obama and Democrats when the Census Bureau begins cutting jobs this summer. Job figures could look great in March, April and May only to look terrible in June, July and August, Shierholz said.
Goldman Sachs on Tuesday projected a small improvement in the labor market. It recorded a drop in the gap between jobs available and jobs that are hard to get.
The ratio of 41.4 percent is the best reading of that statistic since August 2008, Goldman said in the report, but is still indicative of a fragile labor market.
Zandi said job growth won’t be strong enough until late in 2010 or early in 2011 to bring down unemployment significantly.
“A lack of credit for small businesses and still-weak business confidence will slow the job-market recovery,” he said.