Economic Outlook: It only looks like jobs

By some accounts the presidential election pivots on the jobs report released Friday morning, the U.S. Department of Labor pegging unemployment at 7.9 percent.

It hardly matters what the rate is, however. What's important is that it moved higher, which is fodder for Republicans, a bit like syrup on their pancakes.

Legitimate explanations will likely get lost in the din of political rhetoric. With economists predicting the rate would climb from September's 7.8 percent, both Republicans and Democrats no doubt tested out responses through the night to find one that sounded convincing to voters.

It is highly unlikely that the president or GOP contender Mitt Romney will delve into the data deep enough to explain there were 154,000 fewer "discouraged workers" in October than there were in October 2011. This points to more people looking for work -- after all, the unemployment rate is a percentage of something, is it not?

Is there any place for irony in a political campaign? Financial Times economics editor Allen Beattie mused Thursday -- or maybe it was mumbled cantankerously -- that both Democrats and Republicans are shill artists, anyway, neither one willing to tell the truth about the economy.

The most pervasive deceit, apparently, is duping voters into believing presidential policies actually make a difference one way or another.

"Herds of peaceably grazing policy wonks have been left shaking their heads in dismay," at the campaign rhetoric, Beattie wrote in one of the more lyrical laments of the year.

Back to the irony of the day: While candidates club the unemployment data into palatable pulp, few will explain that most of the lowering of the unemployment rate in recent months has been due to "discouraged workers," who skewed the data by giving up on finding a job.

They are defined as workers who return to school or decided to take care of an invalid relative or an infant, leaving out the possibility that these were choices made under the duress of being unable to find work.

The second irony is the point that a lower unemployment rate has the tendency to lure these "discouraged workers" back to looking for work again. So the data is shifting in part because the horses ran back into the burning barn and the data keeps reflecting the dysfunction rather than anything that looks like progress.

In international markets Friday, the Nikkei 225 index in Japan rose 1.17 percent while the Shanghai composite index in China gained 0.6 percent. The Hang Seng index in Hong Kong climbed 1.33 percent while the Sensex in India added 1.04 percent.

The S&P/ASX 200 in Australia was flat, rising 0.06 percent.

In midday trading in Europe, the FTSE 100 index in Britain gained 0.3 percent while the DAX 30 in Germany climbed 0.57 percent. The CAC 40 in France rose 0.62 percent while the Stoxx Europe 600 gained 0.55 percent.