The engine of job creation has been derailed. We are now years behind the curve, and as the economic indicators keep showing, we continue to do no more than tread water. Factory orders and durable goods hit three-year lows in March, and so it will come as no shock if jobs match that pattern. We will see whether the pessimistic indicators accurately predict the BLS employment report tomorrow. Given the rise of weekly initial claims for unemployment benefits and the recent history, the betting will be toward another month of slow job creation rather than a return to the relatively more robust winter growth figures.
What happens when job creation fails to maintain any momentum? The closer the election comes, the worse it is for President Obama. His campaign has lately occupied itself with just about every topic except the economy and job creation, including a silly attack on Mitt Romney as insufficiently ruthless to kill Osama bin Laden after months of painting him as a ruthless killer of jobs as a Bain executive. Whether it’s contraception or Swiss bank accounts, the Obama campaign seizes on any momentary distraction it can find to avert attention from jobs and the economy.
A poor report tomorrow will make that impossible, at least for a few days. The mild momentum of the winter would have given way to another stagnant spring, the third in a row, as David Gregory pointed out to Treasury Secretary Tim Geithner on Meet the Press in April. Even a mildly positive report – say, growth in the 165,000 range, as Wall Street Journal’s Marketwatch consensus expects, will raise questions about whether the current economic and regulatory climate will ever allow for the kind of recovery we saw in the 1980s, or for that matter, under George W. Bush after the 2003 recession.