FACT CHECK: Spinning job growth

Introduction

Romney, Perry and Huntsman each cherry-picked facts about job growth in their states when they were governor. Here we offer a broader look at the numbers, which sometimes tell a different story than the candidates.

During the GOP presidential candidates’ debate on Sept. 7:

• Former Massachusetts Gov. Mitt Romney boasted that Massachusetts was losing jobs when he took office and gaining jobs when he left. That’s true, but the entire country was experiencing job growth during that period, and Massachusetts’ rate of job growth was one of the weakest in the country.
• Romney also boasted that three out of his four years in office, Massachusetts had an unemployment rate below the national average, and ended up with a 4.7 percent unemployment rate. In fact, the unemployment rate was slightly better than the national average when Romney took office, and was identical to the national average when he left.
• Texas Gov. Rick Perry, meanwhile, claimed that Texas created 1 million jobs over the last decade while the U.S. lost 2.5 million. That’s true for Texas, but job losses in the U.S. as a whole have been less dramatic. Furthermore, job growth in Texas hasn’t kept pace with the rise in the state’s population — so the number of jobless Texans also has risen, along with the state’s unemployment rate.
• Jon Huntsman claimed that when he was governor, Utah was No. 1 in the rate of job creation, better than Texas. That’s true, according to data based on household surveys by the Bureau of Labor Statistics, but that’s not the best measure. According to the most commonly used yardstick for job growth, payroll data, Utah was actually No. 4, behind Texas.

Jobs, Jobs, Jobs

Never mind that most economists say governors get too much blame when a state’s job numbers go down and too much credit when they grow. In a campaign that has focused primarily on creating jobs, the three Republican candidates with experience as a governor have repeatedly cited employment numbers from their home states to present themselves as job creators and to take shots at their opponents.

Predictably, the jobs claims from the three current or former governors came early and often in the Republican presidential debate at the Reagan Library in California.

Jobs statistics are notoriously easy to massage, and comparisons between different sets of years can be misleading — some governors served during times of great national prosperity; others served during or immediately after times of national recession.

We went to data from the U.S. Bureau of Labor Statistics to present an unvarnished look at the job growth and unemployment numbers during the terms of the three Republican governors. In all cases, we used seasonally adjusted numbers.

The Romney Spin

As he has throughout the campaign, Romney touted job creation during his term as governor of Massachusetts, from January 2003 to January 2007, as proof that he is best qualified to lead the country.

Romney, Sept. 7: “I’m happy to take a look at the Massachusetts record, because when I came in as governor, we were in a real free fall. We were losing jobs every month. We had a budget that was way out of balance.

So I came into office, we went to work as a team, and we were able to turn around the job losses. And at the end of four years, we had our unemployment rate down to 4.7 percent.”

Romney is correct that Massachusetts was losing jobs month after month for nearly a year before he took office. Those losses stabilized in his first year, and the state then began to see job growth. According to BLS statistics, over the entirety of Romney’s term in office, the ranks of Massachusetts’ employed went from 3,224,600 to 3,270,400. That’s a 1.4 percent increase. However, that was far slower growth than the national average, 5.3 percent. In fact, as Perry and Huntsman correctly pointed out at the debate, Massachusetts ranked 47th in job growth over the length of Romney’s term. The only states that did worse: Louisiana, Michigan and Ohio.

As for Romney’s boast that unemployment in Massachusetts dropped under his watch, that’s true. The unemployment rate went from 5.6 percent in January 2003 to 4.6 in January 2007. But that’s not such a dramatic swing when viewed against the national backdrop. Massachusetts’ unemployment rate was slightly better than the national unemployment rate of 5.8 percent when Romney took office and was roughly the same as the national rate when he left office.

Perry’s Record

Ever since he jumped into the presidential race, Perry has touted his job creation record in Texas as a model for a national turnaround.

Perry, Sept. 7: “What Americans are looking for is someone who can get this country working again. And we put the model in place in the state of Texas. When you look at what we have done over the last decade, we created 1 million jobs in the state of Texas. At the same time, America lost 2.5 million.”

It’s certainly true that Texas has done better than the country as a whole in terms of job growth. When Perry stepped into office in December 2000, employment in Texas was at 9,537,900 and rose to 10,619,800 as of July 2011. That’s just over a million jobs, as Perry said. And it’s an 11.3 percent increase. Over that period, only four states grew jobs at a faster rate: North Dakota, Wisconsin, Alaska and Utah.

Perry’s comparison about U.S. job losses at the same time, however, requires some selective picking of years. If you look at the jobs in the U.S. at the start of Perry’s term as governor (December 2000) and compare it with January 2011, Perry is close to being right — over that span the country lost nearly 2.2 million jobs. But that ignores the job growth over this year. If you look at the U.S. employment numbers from December 2000 to August 2011, the loss is closer to 1.4 million jobs. That’s still a big difference, just not quite as dramatic.

There are also some caveats to Perry’s job creation record in Texas, which we explored recentlywhen Perry claimed that since June 2009, Texas is responsible for more than 40 percent of all of the new jobs created in the U.S. We concluded that while the statistic is accurate, there’s more to the story. The increase in jobs hasn’t kept pace with the rise in the state’s population — so the number of jobless Texans also has risen, along with the state’s unemployment rate. Under Perry, the unemployment rate went from 4.2 percent in December 2000 (a little worse than the national unemployment rate of 3.9 percent) to 8.4 percent in July 2011 (better than the national rate of 9.1 percent).

Also, as critics have repeatedly noted, Texas is tied with Mississippi for the highest percentage of hourly workers paid at or below the minimum wage. And, as we discussed in our article, Texas also has some unique factors that helped it fare better than most states during the recession. Its economy has benefited from high fuel prices, and Texas didn’t experience the big housing bust.

Huntsman No. 1?

Huntsman, meanwhile, claimed during the debate that he did better than both Romney and Perry when he was governor of Utah from January 2005 to August 2009.

Huntsman, Sept. 7: “I hate to rain on the parade of the Lone Star governor, but as governor of Utah, we were the No. 1 job creator in this country during my years of service. That was 5.9 percent when you were creating jobs at 4.9 percent.

And to my good friend Mitt, 47 just ain’t going to cut it, my friend, not when you can be first. We’ve got to remember, that to beat President Obama, we have to have somebody who’s been in the private sector, understands the fragility of the free market system, has been a successful governor as it relates to job creation, and knows something about this world.”

Huntsman made similar claims in a web ad titled “#1 vs. #47,” which was released this week. The ad cites an article by the National Review Online to back up his claim for Utah being No. 1 in job growth during his tenure as governor.

That article used BLS data from surveys of 60,000 American households. And according to that data, jobs in Utah grew by 5.9 percent, tops in the country.

Most economists, however, cite BLS statistics derived from payroll data to assess job growth. According to the Bureau of Labor’s payroll data, the number of employed people in Utah went from 1,124,900 to 1,178,800 during Huntsman’s term. That’s a 4.8 percent increase. That’s much better than the national average, which saw jobs decline by 1.8 percent over that same period. But it’s not best in the nation. Using that data, Utah ranked fourth, behind Wyoming, North Dakota and — notably — Texas.

And, we should note, Huntsman cites a report that used the payroll data numbers to arrive at Massachusetts’ No. 47 ranking under Romney.

Under Huntsman’s watch, the unemployment rate in Utah went from 4.5 percent in January 2005 (better than the national rate of 5.3 percent) to 7.4 percent in August 2009 (substantially better than the national rate, which was 9.7 percent).

There are lots of caveats to these statistics. All three candidates served different terms. Some served during times of recession or recovery, factors that largely drive both national and state job growth statistics. And it’s unclear how much influence any of these governors had on the numbers one way or the other. Still, with every candidate in the race seeking to assume the mantle as the most capable job creator, we’re sure you’ll see a lot more slicing of the employment numbers as the campaign moves forward.

– Robert Farley