Hiring surge lifts US economy — and Trump’s re-election chances

In this file photo taken on April 04, 2019, now hiring paperwork is seen on the Goodwill South Florida desk during a job fair put on by Miami-Dade County and other sponsors in Miami, Florida. The United States had another giant month of job creation in April, confirming the strength of the world's largest economy as President Donald Trump prepares to fend off challengers in next year's election. (AFP / GETTY IMAGES NORTH AMERICA / JOE RAEDLE)
Updated 04 May 2019

Hiring surge lifts US economy — and Trump’s re-election chances

  • US records lowest unemployment rate in a half century and higher hourly wages
  • Even Trump’s critics are forced to admit the state of the economy could help him at the ballot box

NEW YORK: The lowest unemployment rate in a half century. More than 260,000 new jobs. And higher hourly wages.
“I’ll be running on the economy,” President Donald Trump declared on Friday. And why wouldn’t he?
The day’s new round of sunny employment figures offered fresh evidence of a strong national economy — and a big political advantage for Trump just as the 2020 presidential campaign begins to intensify. Stocks are at or near record levels , too, as the president often notes.
Democrats pointed to regional disparities in the new government report. And overall income inequality hasn’t narrowed.
But the Democrats who are fighting to deny the Republican president a second term are beginning to acknowledge the weight of their challenge: Since World War II, no incumbent president has ever lost re-election in a growing economy.
Even Trump’s critics are forced to admit the state of the economy could help him at the ballot box.
“Relative to all the other terrible aspects of Trump’s record, the economy is more of an asset to him,” said Geoff Garin, a veteran pollster whose clients include Priorities USA, the most powerful super PAC in Democratic politics.
Indeed, it was a day of celebration for Trump and his allies, who have been well aware of recent warnings that the economy might slow this year.
The president’s chief economic adviser, Larry Kudlow, said the United States has entered “a very strong and durable prosperity cycle.” He gave all the credit to his boss: “He is president of the whole economy.”
By most measures, the US economy is in solid shape. It is expanding at a roughly 3% pace, businesses are posting more jobs than there are unemployed workers and wage growth, long the economy’s weak spot, has picked up.
All these trends are helping lift a broader swath of the population than in the first five years or so after the Great Recession.
Low-income workers are actually seeing healthy wage gains — larger than everyone else’s. In March, the poorest one-quarter of workers were earning 4.4% more than a year earlier, according to data compiled by the Federal Reserve Bank of Atlanta. The richest one-quarter were up 3%.
Lower-income workers had started to outpace their higher-paid counterparts in 2015, so it’s not a Trump phenomenon. And part of the increase has occurred because of minimum wage hikes by more than two-dozen states.
The news isn’t good for everyone.
Workers in metro areas are still getting larger pay increases than those in smaller towns or rural areas, according to the Atlanta Fed’s data. In fact, that gap that has widened since Trump was elected.
And overall income inequality hasn’t narrowed. The richest 5 percent of Americans earned 3.4 times a median worker’s pay in 2018, according to the left-leaning Economic Policy Institute. That’s up from 3.3 times as much in 2016.
In Carlisle, Pennsylvania, in a region Trump carried three years ago, county archivist Barbara Bartos said the president’s policies have helped a lot of people although she’s seen little economic benefit personally.
“I think he should get credit where credit is due,” said Bartos, a 69-year-old registered Democrat who backed Hillary Clinton. “And I think that he helped a lot of people but left a lot of people out.”
Three hundred miles to the west in Cleveland, another former Clinton supporter, 42-year-old IT manager Jessica Wieber, said she feels “pretty good” about her economic situation.
“I think he’s had a big impact,” she said of Trump’s effect on the economy, adding that tax breaks given to companies and corporations have allowed them to hire more workers.
“I hope it helps trickle down a bit,” said Wieber, a single mom with four children.
Amid the largely positive news for Trump, friends and foes alike question whether he can stay focused on the economy as the 2020 contest plays out. Blessed with similarly positive news in the past, he has veered into more controversial topics like immigration, the Russia investigation and personal attacks against his rivals.
Democrats, in fact, are counting on him to change the subject.
“The economic indicators would normally be incredibly positive for an incumbent president,” said Jefrey Pollock, the pollster for Democratic Sen. Kirsten Gillibrand’s presidential campaign. However, the pollster said hopefully and somewhat rudely, “He can’t shut his mouth.”
At this point, 18 months before Election Day, Trump’s political standing is far weaker than the economic numbers would suggest.
The latest CNN poll finds 43% of Americans approve of the way he is handling his job as president. That’s even as 56% say they approve of his handling of the economy, marking a high for the president since he took office.
He receives lower marks for other issues, including health care, immigration and foreign policy.
Specific candidates aside, the General Social Survey, a respected nationwide survey, has found that the share of Americans feeling satisfied with their finances has returned to pre-recession levels.
In 2018, about a third expressed satisfaction with their financial situation, up from 23% in 2010. About 4 in 10 said their finances had been improving over the previous few years, while just 15% felt them worsening.
In 2010, more than twice as many said their financial situations were getting worse.
Last month, the government report said, the African American unemployment rate was 6.7%, up from a record-low 5.9% last May. That’s more than double the rate for whites. And in 2017, according to the latest data available, the black-white income gap widened, with the typical African American household earning $40,258, while the equivalent white figure was $68,145.
Still, the Asian and Latino unemployment rates hit or matched record lows in April.
By some measures, the job market has been better in the past.
A much smaller proportion of Americans are working than in the late 1990s, the last time unemployment was nearly this low. Part of that is because the United States is aging and baby boomers are retiring.
But even among workers aged 25 through 54, which filters out the impact of retirement and increased college attendance, a smaller percentage of people are working: In April 79.7% had jobs. That figure peaked at 81.9% back in 2000.
How much all this will affect the election is an open question.
Ray Fair, a Yale University economist who uses economic data to model election outcomes, says that the state of the economy in the first three quarters of an election year matters more than the rest of a president’s term.
Fair’s model points to a Trump victory in 2020, should the economy continue along its current path.
However, “This doesn’t take into account the personalities,” Fair said. “Trump is an unusual person.”

 

 


Britain’s Johnson plays down Brexit breakthrough hopes

Updated 26 min 49 sec ago

Britain’s Johnson plays down Brexit breakthrough hopes

  • EU leaders will meet on Thursday and Friday for a summit held under the pressures of the October 31 Brexit deadline

LONDON: British Prime Minister Boris Johnson played down hopes Sunday of a breakthrough in his last-ditch bid to strike an amicable divorce deal with the European Union.
Negotiators went behind closed doors for intensive talks in Brussels after Johnson outlined a new set of proposals to Irish Prime Minister Leo Varadkar on Thursday.
They have very little time left to succeed.
EU leaders will meet on Thursday and Friday for a summit held under the pressures of the October 31 Brexit deadline just two weeks away.
The 27 would ideally like to have a full proposal to vote on by then.
But the sides are trying to achieve in a few days what they had failed to in the more than three years since Britons first voted to leave the European Union after nearly 50 years.
Chief EU negotiator Michel Barnier called the weekend negotiations “constructive” enough to keep going for another day.
“A lot of work remains to be done,” Barnier stressed in a statement to EU ambassadors.
“Discussions at technical level will continue (Monday).”
Downing Street said Johnson also told his cabinet to brace for a cliff-hanger finish.
He reiterated “that a pathway to a deal could be seen but that there is still a significant amount of work to get there and we must remain prepared to leave on October 31,” a Downing Street spokesman said.
Johnson rose to power in July on a promise not to extend Brexit for a third time this year — even for a few weeks.
Breaking that pledge could come back to haunt him in an early general election that most predict for the coming months.
Johnson is under parliamentary orders to seek a extension until January 31 of next year if no deal emerges by Saturday.
He has promised to both follow the law and get Britain out by October 31 — a contradiction that might end up being settled in court.
Outgoing EU chief Jean-Claude Juncker said British politics were getting more difficult to decipher than the riddle of an “Egyptian sphinx.”
“If the British ask for more time, which they probably will not, it would in my view be a historical nonsense to refuse them,” Juncker told Austria’s Kurier newspaper.
Ireland’s Varadkar hinted on Thursday that he could support the talks running on up to the October 31 deadline if a deal seemed within reach.
The few details that have leaked out suggest a compromise around the contentious Irish border issue Britain’s Northern Ireland partially aligned with EU customs rules.
Whether such a fudge suits both Brussels and the more ardent Brexit backers in parliament who must still approve a deal should become clearer by the end of the week.
Britain will only avoid a chaotic breakup with its closest trading partners if the agreement is also passed by the UK parliament — something it has failed to do three times.
Johnson heads a minority government and must rely on the full backing of not only his own fractured Conservatives but also Northern Ireland’s small Democratic Unionist Party.
DUP’s parliamentary leader Nigel Dodds warned Johnson that “Northern Ireland must remain entirely in the customs union of the United Kingdom” and not the EU.
“And Boris Johnson knows it very well,” Dodds told Italy’s La Repubblica newspaper.
The comments do not necessarily rule out DUP support.
UK media are presenting Johnson’s mooted compromise as a “double customs” plan that could be interpreted to mean that Northern Ireland is leaving EU rules.
Yet details are still under discussion and the prime minister’s allies are urging lawmakers to give the British leader a chance.
Main opposition Labour Party leader Jeremy Corbyn signalled Sunday that he would wait for the outcome of the EU summit before trying to force an early election.
But he added that there was “a strong possibility” that those polls would come before the Christmas break.