Fiscal Fog and the Jobs Report
Today’s jobs report indicates that the cautious pace of hiring that has been the recent trend continued through the end of the year. The consensus forecast of 150,000 jobs almost nailed it, and the unemployment rate was revised up a bit, something that was also expected because the household survey was out of line in the last few months.
The initial claims data are wholly consistent with this report as well, so we know exactly what we had at the end of the year. The most remarkable thing about this report is that there was no discernible effect of the fiscal cliff; private citizens appear to have tuned out Washington and just went about their business. That could be because there is so much fiscal fog that the cliff fog had no impact on visibility.
This is not enough job creation to really make a dent in unemployment. To get to the next level, we still need a grand bargain that clears up the fiscal fog.