Tomorrow’s Jobs Report Will Look Great But Includes Census Hires

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
Today ADP reported that private-sector jobs may have increased by 55,000 last month. (ADP is able to make this estimate because the company processes 1 of every 6 paychecks nationwide.) Meanwhile the Labor Department reported that initial claims for unemployment dropped 10,000 to 453,000 for the week ended May 29. Note that this drop brings the level “down” to what was nearly the peak number of layoffs in the last recession.
Tomorrow the Bureau of Labor Statistics will release its May jobs report. The report is expected to show that as many as 4-500,000 jobs were created last month. That 55,000 increase in the ADP report is private-sector jobs, while tomorrow’s jobs report includes government hiring, and this could include as many as 400,000 temporary census workers.
But while one hand gives, the other takes away. Over at Firedoglake, David Dayen warns in Pre-Gaming the Jobs Report,

The other factor here is that, while temporary federal government jobs are rising because of the Census, permanent local government jobs are going away. State budget cuts could lead to as many as 900,000 jobs lost in 2010. And Congress decided last week to do nothing about that, cutting money in a jobs bill for the states to balance their Medicaid budgets.

A report showing 4-500,000 new jobs is always a great thing. But let’s not get ahead of ourselves. We need to see reports like that continue for a year just to catch up to the jobs lost due to conservative policies of the previous administration!
The danger is that deficits hawks will cite this report and say it is time to turn to deficit reduction instead of investing in our economy and our people. But deficit reduction comes from investing in our economy and our people. Cutting back on unemployment checks, health care, infrastructure, education and all the things conservatives want us to cut back on means a worse economy in future years.
Another danger is that conservatives will misrepresent the report (imagine that!) and say that the economy is not creating real jobs, only temporary “government jobs.” Jobs are jobs and temporary government paychecks still buy food at local groceries, clothes at local retailers, etc. Conservatives also say the stimulus “didn’t work” or even claim the stimulus is the reason unemployment is high. Actually the CBO recently reported that the stimulus put as many as 2.8 million people to work, lowered the unemployment rate by as much as 1.5% and boosted the GDP by as much as 4.2%.
Calculated Risk has its own prediction on the unemployment report tomorrow, that it will be reported badly.
Finally, a reminder of where we are: