WASHINGTON, Nov. 5 (UPI) -- For President Bush, the euphoria continues.
Friday's employment report indicated that more jobs were created under George W. Bush's watch, as the Bureau of Labor Statistics reported that 337,000 positions were created in October, the largest number in seven months. The data only boosted Wall Street's already buoyant mood, as U.S. investors continued to ride on the wave of optimism that started from the opening bell the day after the elections Wednesday.
The momentum was boosted with the latest unemployment report that surpassed investors' expectations, and in late morning trading Friday, the Dow Jones industrial average is up 46.54 points, or 0.45 percent at 10,361.30, while Nasdaq is up 11.25 points at 2,034.88, largely on the back of the strong jobs data.
Senior White House officials were quick to point out the Bush administration's achievements on the economic front, a reaction that perhaps has become habit after months of campaigning and defending the president's track record.
"The growing strength of the U.S. economy is further evident in (Friday's) unemployment report. For the 14th consecutive month, jobs were added in America," Treasury Secretary John Snow. "There can be no doubt that President Bush's tax relief, combined with good monetary policy, the strength of our small-business sector, and our outstanding workforce, has led to a growing economy that is producing good jobs for American families," he added.
The upbeat mood was prevalent among investors too, and the chief economist of Griffin, Kubik, Stephens & Thompson, Brian Wesbury, said that "the combination of the political season and challenges in measuring non-farm payrolls have led the market to underestimate the true strength of the economy. (Friday's) report should go a long way to converting any holdouts."
Yet, even administration officials suggested that the surge in jobs may not be sustainable, given that many jobs in October were created as a result of reconstruction efforts after the hurricanes hitting the southern parts of the United States in early autumn. Indeed, the head of the BLS, Kathleen Utgoff, pointed out that the biggest gains were seen in the construction sector, with 71,000 new jobs, due to "rebuilding and cleanup activity in the Southeast following the four hurricanes that struck the U.S. in August and September."
But the fact that the latest job gains could well be temporary, especially as many people were temporarily unemployed during the hurricanes, was only reason not all analysts shared the administration's upbeat outlook on the U.S. jobs market.
For one, while more jobs continued to be created, October's unemployment rate actually went up, nudging up to 5.5 percent from 5.4 percent in September, which signals that more people were trying to get back into the workforce but not having success in finding paying jobs.
"We can expect an increased number of people seeking work, thereby causing unemployment to rise even though there will be consistent job growth," said the head of the Washington-based Economic Policy Institute Lawrence Mishel. "We saw similarly strong job growth in the early spring, but it faltered over the summer. We will see over the next several months whether the labor market has finally established a firm recovery," he added.
That view was echoed by the head of the trade unions group AFL-CIO, John Sweeney. While Sweeney lauded the latest report as "a welcome pick-up in jobs," he too pointed out that much of the paid positions were created in the aftermath of the hurricanes, adding that 1.3 million jobs have been lost since 2001.
"The average length of long-term unemployment remains at 19.6 weeks and millions of workers are forced to work multiple jobs to pay for healthcare and basic household expenses... after four years of massive job loss, sagging wages and rising health care costs, workers deserve economic policies that will improve their standard of living and provide sufficient time with their families," Sweeney added.
Granted, the White House too acknowledged that not all workers who want a job have one, and following the latest unemployment report, the administration repeated its solution to economic doldrums remains pushing for "pro-growth policies that create jobs, and opposes tax increases that would add a burden to working families and set back our economy."
Meanwhile, many Fed watchers anticipate the Federal Reserve to raise interest rates a quarter percent to 2.00 percent when the Federal Open Market Committee next meets Nov. 10, in light of the strengthening economy.