Brad DeLong's Semi-Daily Journal (2004)

Note: The Blue Chip and the Administration Employment Forecasts

Lerxst of Economists for Dean compares the Blue Chip employment forecasts to the administration's:

Economists for Dean: The CEA and the Blue Chip Forecasts: how out of line the Administration forecasts of jobs are. If I understand it correctly the current operative forecast out of the CEA is that employment will average 131.9 million over the year 2004 which implies an average monthly gain of about 320,000 jobs.

I thought I would compare this to the Blue Chip forecast of the 50 leading forecasters (requires subscription) for February 10, 2004. Here in the "Special Questions" section they ask forecasters what they expect the average monthly change in employment to be during 2004. Here is what they report:

Consensus:
166 thousand

Top 10 Average:
223 thousand

Bottom 10 Average
108 thousand

So basically the administration is projecting about 100,000 more jobs per month (1.2 million over 2004) than the top 10 forecasts in the Blue Chip group!.

So while their GDP forecast is in line with Blue Chip forecasts... (see p84 of the Economic Report of the President):

The Administration expects real GDP to grow at an annual rate of 4.0 percent during the four quarters of 2004, a figure that is close to the latest Blue Chip consensus economic forecast (as of January 10, 2004).

their jobs number is clearly a political statement as Brad Delong suggests.

The lack of any public defense by the CEA of the underpinnings of its forecast--of what they think the expected paths of hours, of labor productivity, et cetera, is very depressing.