A strong labor report Friday that found the economy added 217,000 jobs is doing little to raise Democratic spirits ahead of the midterm elections.
It’s the third month in a row of strong job growth for the economy, something that should put some wind behind President Obama’s sails in the months before November.
Stocks rose on the news, climbing to a new record high. Some economists are expecting the economy to grow stronger, too, in the summer and fall – just before the midterms.
The problem for Obama and his party is that none of that appears to be making voters feel any better about the economy, or his handling of it.
Though job growth after the latest report has now eclipsed the jobs lost during the recession, the economic growth pales in comparison to the 1980s and 1990s.
“Obama came in and said he would make things better. He did make things better, but he didn’t make them anywhere near as they had been in the ‘80s and ‘90s and that’s still people’s reference,” said Robert J. Shapiro, former principal economic adviser to President Clinton. “There’s deep disappointment and anger in the electorate about what’s happened to their lives economically for the last decade.”
Democrats hope a stronger economic recovery could help improve Obama’s standing with the public and their chances of retaining the Senate this fall.
But Shapiro argues Democrats remain at a disadvantage, despite the recent jobs reports, since the public sees Obama and the Democrats as responsible for years of economic pain.
“There's an advantage to the Republicans, no doubt about it,” Shapiro said of the economy. “The public sees the president and the president's party as responsible for the economy.”
Overall, the economy lost 8.7 million between January 2008 through February 2010.
The May report means gains have now eclipsed 8.8 million, but that may not be enough to change the public’s mood.
Jim Manley, former spokesman for Senate Majority Leader Harry ReidHarry Mason ReidDemocrats say Biden must get more involved in budget fight Biden looks to climate to sell economic agenda Justice Breyer issues warning on remaking Supreme Court: 'What goes around comes around' MORE, said it'll be tough for Democrats to run on the economy, but just as hard for Republicans, too.
“For anyone up for reelection they’re in an heck of a better place than six months ago but they’re not in a spot yet where they can run on what the economy is doing because it is still at zero-net jobs growth,” Manley said.
That hasn't stopped lawmakers from their monthly economic tit-for-tat following jobs reports releases.
In a public statement, Reid (D-Nev.) declared economic victory, though not without telling Republicans to “stop taking their marching orders from the Koch brothers.” Meanwhile, Republican National Committee chairman Reince Priebus charged that “Obama has given up on creating jobs.”
Gabe Horwitz, director of center-left think tank Third Way, said that neither side fully owned the economic issue this cycle.
“Republicans are talking about tax reform, and Democrats are talking about college affordability,” Horwitz said. “But those are only parts of it. Both parties are starting to talk about it a little bit, but the broader issue is that middle class voters feel like a middle class job isn't supporting a middle class lifestyle anymore.”
While consumer confidence has steadily increased since it bottomed-out at 25.3 in February 2009, the most recent report from May puts confidence at 83. That’s still under pre-recession levels, when it was more than 90.
Despite the four-month streak, Republicans have pounced on the labor participation rates in recent reports. May's 62.8 percent rate — those who have or are looking for work — was unchanged from April and remains near a 35-year low last seen when President Jimmy Carter was in office.
Republicans say that Obama hasn't improved the economy, he's just stopped counting people who aren't looking for work. Critics of that approach argue that the participation rate is skewed by Baby Boomers, many of which are at the cusp of entering or considering retirement.
The economy and jobs growth face gaps in jobs, wages and workforce participation before a more spirited recovery kicks into high gear, and that isn’t expected to happen before November.
Mark Zandi, chief economist with Moody’s Analytics, said that the key to future growth is the housing sector’s expansion, which he called “vitally critical.”
Zandi's data is locking-in economic growth at a 4 percent annual pace in the April-June quarter. Growth could taper a bit heading into the midterms but should maintain a 3 to 3.5 percent annual rate, he said.
Meanwhile, the jobs growth numbers are forecast to hit a monthly average of 250,000 to 300,000 by the end of the year, which would provide Democrats with a stronger argument to voters that their policies are working.
“We have a long way to go even with stronger jobs numbers,” Zandi said.