Strong February Employment Still Downplayed by Some Media
While Wall Street cheered the great news the Dow Jones Industrial Average rallied by 104 points after the announcement ABC and The New York Times werent content to allow people to celebrate for very long. Instead, The Times began downplaying the good news in the first sentence of its March 11 article, stating the report was igniting concerns on Wall Street that higher wages could fuel inflation.
And, though ABCs World News Tonight led with this story on the evening of March 10, it finished its report discussing those still having a hard time finding work, suggesting that this may account for why 57 percent of Americans in our ABC polling say this economy is bad.
Yet, some media outlets appeared to heed the advice given in the Business & Media Institutes January special report Hit Job: Networks Emphasize Layoffs in a Year of 2 Million New Jobs. In particular, CBS, NBC, and The Washington Post gave uncharacteristically balanced reports on the February data, including phrases like This is a surprisingly strong start of the year and There are a lot of new jobs out there.
As reported by Bloomberg on March 10: American employers added a greater-than-expected 243,000 workers in February and incomes rose, signs the job market will bolster consumer spending and economic growth. Yet, although this information was released at 8:30 a.m., CNN didnt bother reporting this to its viewers until more than 12 hours later near the end of Paula Zahn Now. Even worse, regardless of the importance of this monthly stat, the show gave it a mere four sentences.
The Times and ABC didnt do much better, and instead continued with the trend of downplaying good unemployment numbers even in the face of extremely strong data. For instance, The Times article began downplaying the news in the very first sentence. After reporting the good job gains, writers Eduardo Porter and Vikas Bajaj added immediately that this is igniting concerns among many Wall Street economists that higher wages could fuel inflation and increase expectations that the Federal Reserve will raise interest rates further. As a result, The Times created a no-win situation for the economy: bad news is bad, and good news is bad.
Next, The Times offered its readers another reason to not celebrate these fabulous numbers: But some economists cautioned that employment is benefiting from the exceptionally mild weather in January and the beginning of February, and that employers' demand for workers is unlikely to remain as strong in the coming months. Once again, The Times created a lose-lose situation. After all, if the weather had been cold the past couple of months, the Times likely would have focused on high energy bills bills that werent nearly as high as forecast thanks to the mild winter.
The Times continued to temper the good news of this report with weather concerns throughout its article: Yet the job market may not remain as robust as it now appears, as employment over the last two months has been inflated by exceptionally mild weather. The authors even found an economist to support this view: Brian Bethune, United States economist at Global Insight, an economic analysis firm in Lexington, Mass., said that if one excluded the temporary effect of the balmy winter as well as some boost to jobs from the reconstruction efforts on the Gulf Coast employment growth is averaging about 180,000 jobs a month.
Certainly, no one can contest that February was an unseasonably mild month, and that this might have had an impact on hiring in some sectors of the economy. However, such factors were built into the expectations by analysts and economists that payrolls would increase by 210,000, a number that was greatly exceeded. And, as Bloomberg reported, most economists are forecasting very strong job numbers for the rest of the year regardless of the weather: Recent surveys show business executives are preparing to boost hiring and wages. Fifty-nine percent of U.S. firms plan to increase employment over the next 12 months, leading to a 2 percent gain in jobs, according to a survey of chief financial officers issued by Duke University this week.
A third caveat offered by The Times for its readers to be concerned with was housing: These gains are unlikely to continue at their current rate, as the housing market begins to wobble, housing inventories rise and the construction of new homes starts to decline. Of course, according to a special report done by The Business & Media Institute last November, journalists have been forecasting a crash in the housing market with disastrous economic portent since 2001.
Not to be outdone in the downplaying mode was ABCs World News Tonight. Now, to its credit, ABC at least covered this piece of economic data last month when the January employment numbers were released on February 3. As noted by Brent Baker of the Media Research Center, World News Tonight didnt bother reporting the news of a 0.2-percent decline in Januarys unemployment rate, focusing that Fridays installment instead on the cartoon outrage by Muslims and a full piece on an Institute for Highway Safety study on how design changes in SUVs have reduced deaths in smaller vehicles they hit.
To compensate for last months oversight, World News Tonight led with Februarys unemployment report. Host Elizabeth Vargas stated, We begin with signs of strength for the US economy. After sharing some of the positive data, correspondent Dean Reynolds downshifted into gloom gear: But anxiety remains. Reynolds then interviewed some folks having a hard time finding a job. There may be more jobs, but is - is it in the field where I can be best placed? asked one of these job seekers.
Reynolds continued with more negativity: The anxiety is fueled in part by word that manufacturing, long a mainstay of the nation's economy, lost 1,000 jobs last month. The economy gained 243,000 jobs, but World News Tonight spent time talking about one sector that lost 1,000 jobs. Reynolds then interviewed Professor Peter Morici of the University of Maryland Business School who reinforced this sense of doom: Basically, manufacturing's in neutral while everybody else is expanding. This has not been a great recovery for ordinary workers.
Even worse, despite marvelous news, Reynolds concluded this segment with an absolute downer: And that may account for why 57 percent of Americans in our ABC polling say this economy is bad, Elizabeth. And why only 17 percent say it's getting better.
On the positive side, the CBS Evening News, which also neglected Januarys drop in unemployment, made amends on March 10. Filling in for Bob Schieffer, anchor Steve Croft began his report: A lot of Americans have jumped back into the job market, and that's pushed the unemployment rate up a bit to 4.8 percent. Still, there are a lot of new jobs out there. Croft then handed it off to correspondent Anthony Mason, who reported on how one industry is actually having a hard time finding employees in this strong labor market: It's the worst labor crisis in the industry's history. The American Trucking Association says it needs another 20,000 drivers, and the shortage could grow to 100,000 within a decade.
The NBC Nightly News also did an accurate job on March 10. Brian Williams began his report:
Payrolls rose by close to a quarter of a million in February. That was better than expected, an improvement over January. Those brighter prospects sent more people streaming into the labor market, which sent the unemployment rate up a notch to 4.8 percent.
Unlike The New York Times and ABC, NBC highlighted an economist who actually liked these numbers. [Companies] have lots of cash, they now have some confidence, and the combination of cash and confidence means lots of jobs, said Moodys Mark Zandi.
And, The Washington Post did a fair job with this data in its March 11 article as well. Author Neil Irwin began enthusiastically, Employers added jobs rapidly last month, the latest evidence that the U.S. economy began the year on an upswing, and emphasized this sentiment later with, The new report provides further evidence that the economy is growing at a healthy pace, after a lull at the end of last year. Although The Post had similar caveats as The Times, including the unseasonably mild February weather, Irwin at least waited until the fourth paragraph rather than downplaying the numbers in the first sentence.
All in all, despite a lot of gloom and doom, the media showed a huge improvement in covering this important piece of economic data. Whether four and a half years of uninterrupted economic growth is finally wearing down the constant media pessimism, or this is just a rare moment of clarity for the press, still remains to be seen.
Noel Sheppard is an economist, business owner, and contributing writer to the Business & Media Institute. He is also contributing editor for the Media Research Centers NewsBusters.org. Noel welcomes feedback at email@example.com.