reader Rick Stryker wrote:
Mitt Romney didn’t criticize Biden’s economy, saying we should see 500,000 jobs added, which is a good thing, because it would trigger another multi-year rant from Munchy, that’s impossible! ! !
Mr. Rick Stryker mischaracterized what I had written. I said 500,000 was an unlikely number for a recovery month, and I stand by that, even though we said 500,000 was the reason for the labor force growth. Here is my post from May 2012:
Gov. Mitt Romney has said he expects to create 500,000 jobs a month during the recovery. [1]. It actually last happened in May 2010, but is otherwise very rare.reader Rick Stryker Think 500K should be expressed as a percentage to account for employment size. Still, in the eight years of GW Bush’s administration, there has never been a percentage violation of the equivalence.
figure 1: Monthly growth in nonfarm payrolls (log difference, non-annualized), sa (blue), and monthly change in 500,000, expressed as a percentage of April 2012 nonfarm payrolls. Source: BLS April issue, via FRED.
In fact, for the past 21 years or so, one would have to go back to the Clinton administration to find such numbers.
Oh, and by the way, in the past 40 years (basically the end of the Clinton administration), the unemployment rate has only been at or below 4% 11 times.
Here is an updated graph:
figure 1: Month-over-month growth in nonfarm payrolls (blue), and 500K change as a percentage of April 2012 NFP (red line). Sky blue dotted line in April 2012, Governor Romney’s May 2012 statement. The NBER uses shades of grey to define the peak and trough dates of the recession. Source: BLS, NBER, and author’s calculations.
Between Mr. Stryker’s 2012 comments and May 2020, there were exactly zero incidents of NFP growth exceeding 500,000 (expressed as a ratio to NFP).
If one were to assert that the past two years constituted a typical recovery, then I guess it’s fair to say the 500K is “normal.”
