(Bloomberg View) -- Given President Donald Trump's penchant for boasting about his job-creating prowess, one can't help but ask: How much has the trajectory of U.S. employment really changed under his watch?
The latest jobs data suggest a simple answer: almost imperceptibly.
True, the job market has performed well under Trump. The Labor Department estimates that nonfarm employers have added about 2.7 million jobs since the last election, helping bring the unemployment rate down from 4.9 percent to 4.1 percent. A small part of those gains can even be traced to Trump's policies: Mining, for example, has added tens of thousands of jobs amid his efforts to relax environmental regulations. And his polarizing effect on society has been a significant -- if unintentional -- boon for nonprofit organizations, which have created thousands of positions as people boost donations to causes of all kinds.
The more relevant question, though, is whether the job market is doing better under Trump than it did before his election. By this standard, his presidency doesn't really stand out. Consider the trajectory of total nonfarm employment: It looks almost exactly the same since Trump's victory as it did in the previous five years:
By some measures, the Trump economy has actually underperformed. From mid-2009 until the November 2016 election, nonfarm employment increased at an average monthly rate of 0.14 percent. If it had maintained that pace through January, about 3.1 million jobs would have been created since the election, or 330,000 more than were actually created under Trump. If employment had increased at the average monthly pace of all postwar economic expansions (0.22 percent), the difference would be 2.1 million jobs. Here's how that looks:
To be sure, it wouldn't be fair to hold Trump responsible for slower job growth, just as it wouldn't be right to give him full credit for an expansion that began almost nine years ago. A slowdown is exactly what one would expect at this point in the business cycle: As the pool of available workers shrinks, employers do less hiring. Ideally, the tight labor market would also push up wages, raising workers' living standards and prompting companies to redeploy their money toward productivity-enhancing investments. That hasn't yet happened to the desired extent, though wage gains have accelerated in the past couple of months.
One big wild card is the Republican tax package, which Trump signed into law in December. Proponents say that companies will use cash freed up by tax cuts to do more hiring and investment. This could even help bring more people from the sidelines back into the labor force. On the other hand, companies might struggle to find productive uses for the money -- or, with the unemployment rate already extremely low, they might have a hard time hiring even if they want to. Time will tell.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Mark Whitehouse writes editorials on global economics and finance for Bloomberg View. He covered economics for the Wall Street Journal and served as deputy bureau chief in London. He was previously the founding managing editor of Vedomosti, a Russian-language business daily.
To contact the editor responsible for this story: James Greiff at jgreiff@bloomberg.net.
For more columns from Bloomberg View, visit http://www.bloomberg.com/view.
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