The jobs numbers for December were released today. Wall Street didn’t like the headline payrolls number because it came in a little bit light, but there is plenty of good news in the report for Main Street.
For starters, unemployment remains near a record low. The headline unemployment rate is 3.5%. We haven’t had a jobs market where the unemployment rate has been below 4% for this long since the 1960s.
Even more impressive is that the underemployment rate is the lowest on record. The underemployment rate adds back workers who gave up looking for work because they couldn’t find a job and those who are working part-time but would prefer full-time work.
Both groups are excluded from the headline unemployment number. Some economists consider the underemployment rate as a better gauge of the labor market’s strength.
In Trump’s first term in office, the underemployment rate has fallen 2.6 percentage points. And it’s not as if Trump came into office at the height of a recession. The economy was deep into an economic expansion when he took over. The low hanging fruit on pushing the underemployment rate down had already been picked.
Compare that to the underemployment rate in Obama’s first term. Obama took over near the height of the recession. In Obama’s first full term in office, the underemployment rate rose.
Yup, even starting from one of the highest levels on record, Obama couldn’t put in place the policies that would allow businesses to recover, regain confidence, and start hiring.
See the charts below for a comparison.