Romney's 500,000 Jobs a Month Is a Pipe Dream
NEW YORK (TheStreet) -- Mitt Romney's claim that the country should be adding 500,000 jobs a month isn't possible.
The presumed Republican presidential nominee Friday told Fox News' Gretchen Carlson that the economy should be growing at more than 500,000 jobs a month, but strategists don't appear to have much faith in the former businessman's forecast.
"Come on ... 500,000 a month, that's a pipe dream," said Josh Feinman, global chief economist for Deutsche Bank Advisors. "That's not sustainable ... but it does underscore the problem."
The problem is that the country still has to restore about 5 million jobs lost because of the recession.
Feinman said the United States lost an estimated 8.8 million jobs from the peak to the trough of the Great Recession, and the country has restored about 3.8 million of those positions. Feinman said that if nonfarm payrolls grew at 200,000 a month that Americans would attain all those lost jobs in about two years.
But that doesn't factor in growth of the population that has come of age to enter the work force.
Feinman said he thinks the country is about 10 million (or double the 5 million short of reaching pre-recession levels) jobs short, which would take us another six or seven years at a 200,000 per-month clip to replace what the country lost.
April nonfarm payrolls grew by just 115,000, well below economists' consensus of 162,000, but March revisions rose to 155,000 and sent unemployment down to 8.1% from 8.2%.
Rarely has the United States added 500,000 jobs a month since the Bureau of Labor Statistics began to collect nonfarm payroll numbers, and it's not a number that appears to be in the mind of strategists.
"What we'll probably start to see is the labor market going back to job growth of about 170,000, maybe 200,000 over the latter part of the spring, early summer," said Michael Strauss, chief investment strategist at Commonfund. "It used to be, 10 years ago, you needed 150,000 jobs to hold the unemployment rate steady; today you probably only need 75,000 jobs a month, because baby boomers are starting to leave the system."