Fall in U.S. jobless rate is timely boost for Obama

Reuters News
Posted: Oct 04, 2012 4:18 PM
Fall in U.S. jobless rate is timely boost for Obama

By Patricia Zengerle

WASHINGTON (Reuters) - A drop in the U.S. unemployment rate to its lowest level since President Barack Obama came into office, announced a month before the election, is expected to give his campaign a boost after he performed poorly in a debate with Republican opponent Mitt Romney.

Labor Department data showed the jobless rate dropped by 0.3 percentage point in September to 7.8 percent, its lowest since January 2009. Employers added 114,000 workers to their payrolls.

Romney had made the president's failure to drive the rate below eight percent a key plank in his campaign.

Reacting to the new data, Romney said the economy remained weak and noted that the unemployment rate would be closer to 11 percent if it included those who had given up looking for work. "This is not what a real recovery looks like," he said in a statement.

David Plouffe, a senior Obama campaign adviser, said on MSNBC: "This is obviously showing that we continue to recover from a horrible recession."

While pollsters disagree over how much of an effect economic data have on voting intentions, a good jobs number can only be positive for the incumbent, who was widely judged to have lost the first presidential debate with Romney on Wednesday.

"Good economic news is good political news. President Obama needed that after the debate and it gives him numerical evidence that his policies are working," said Julian Zelizer of Princeton University.

Crucially, economists noted that the report showed the U.S. workforce was expanding. In some recent months, the unemployment rate had ticked downward largely because many Americans had given up on looking for work.

After the debate in Denver, Romney gained ground on Obama and is now viewed positively by 51 percent of voters, the first time he has enjoyed a net positive in the U.S. presidential race, a Reuters/Ipsos poll released on Thursday found.

But Obama was still narrowly ahead on jobs and employment in the survey by 40.3 percent to 39.6 percent.

Some of Romney's supporters cried foul, questioning the timing of unexpectedly strong figures so soon before the election, especially right after Obama had stumbled.

Jack Welch, the former chief executive of General Electric Co., publicly accused Obama's campaign of manipulating the numbers. "Unbelievable jobs number... these Chicago guys will do anything... can't debate so change numbers," he wrote in a message posted on Twitter. Welch is also a columnist for Reuters.

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U.S. Labor Secretary Hilda Solis said the idea the data was manipulated is "ludicrous."

Analysts dismissed such talk, given the Labor Department's integrity and the many months of weak economic data it has reported that have dogged Obama throughout his presidency.

Democrats noted that comments suggesting malfeasance echoed conservative complaints last week - before Romney's strong debate performance breathed new life into his campaign - that almost every U.S. polling organization was skewing its data to favor the incumbent president.

There will be one more monthly unemployment rate before Election Day on November 6. The October report is due on November 2.

(This story corrects to show rate had ticked downward in paragraph 8)

(Additional reporting by Andy Sullivan; Editing by Alistair Bell and David Storey)