Summer is approaching and nerves are jangling. In recent years the green shoots of the early months withered in the heat of summer. The queue of people worried that this summer will be another in which a recovery is aborted is long: the unemployed, retailers, investors, President Barak Obama and his team, incumbent congressmen of both parties, home builders, and car salesman—to name just a few. Mitt Romney, although not one to wish the nation ill, would be less than human if he did not feel a frisson of excitement at every bit of news that suggests the green shoots won’t flower until after the November elections.
Friday’s jobs report provided the Republican contender with just such a frisson. Only 115,000 jobs were created in April, and the unemployment rate dropped from 8.2 percent in March to 8.1 percent, the lowest level since Barack Obama took the oath of office in January of 2009, but only because thousands more workers gave up the job hunt. If those discouraged workers had remained in the work force, the unemployment rate would be in double digits.
GDP, which grew at the satisfactory rate of 3 percent in the final quarter of 2011, managed only a tepid 2.2 percent growth in the first quarter of this year. That’s half the growth rate of all our recoveries since World War II. Some economists estimate that unseasonably warm weather—the warmest since 1895—added 0.2 percent to growth. Worse still, 0.6 percent of the first quarter growth in output merely swelled inventories of unsold goods. Back out the weather and inventory build-up, and growth comes to a measly 1.4 percent. Business investment declined at an annual rate of 2.1 percent. A bad start to the year—bad enough, in the words of the Wall Street Journal, “to give the word recovery a bad name.”