This Explains Trump’s Wild Claims About Ivanka’s Job Creation

A little misunderstanding of economic statistics can go a long way in creating a false narrative.

Each issue of The Week, a magazine that helpfully recaps “the best of the U.S. and international media,” carries an amusing feature titled, “Good week for/Bad week for.”  The November 22, 2019 installment facetiously declared that Ivanka Trump had a good week, based on her father’s boast that she had single-handedly created 14 million jobs since 2017.  “This means Ivanka deserves credit for a staggering 233% of the 6 million U.S. jobs created during this period,” the periodical gleefully reported.

Going beyond The Week’s gently mocking tone, Vox labeled President Donald Trump’s statement a “whopper.”  Journalist James Fallows described it as one of Trump’s “lunatic claims.” The Guardian said that Trump’s assertion that his daughter created 14 million out of 6 million new jobs “stood out as extreme even among his nearly infinite catalogue of bizarre lies.” New York Magazine took an even harsher line, calling Trump’s November 12 statement to the Economic Club of New York “so astonishingly ludicrous it would embarrass a Stalin-era pronouncement.”

As it turns out, the fulminators committed a major error of their own. To illustrate, The Hill wrote, “The total number of jobs created since President Trump took office is roughly 6 million, about 43% of the total he attributed to his daughter’s efforts alone.” As Soho Forum moderator and former Barron’s economics editor Gene Epstein has tirelessly pointed out, commentators routinely mistake net job creation for gross job creation. In truth, it was not mathematically impossible for Ivanka Trump to have created 14 million jobs since 2017.

Between March 2017 and March 2019, the latest date for which the Bureau of Labor Statistics has released statistics, the private sector alone created 39.2 million jobs. Over the same span, private sector job losses totaled 33.1 million, as many employers contracted or went out of business altogether.  Underlying the net gain of 6.1 million private sector jobs is a basic fact about a market economy: Even in good times, competition and changing supply/demand conditions cause many companies to retrench or fail. Other jobs are lost to automation or offshoring.

Note, however, that saying it was mathematically possible for Ivanka Trump to create 14 million jobs (gross) during a span in which only 6 million jobs (net) were created is not equivalent to saying that she in fact created 14 million jobs. What the First Daughter actually did was to obtain pledges from more than 300 companies to create training and other kinds of opportunities.

By October, she was reporting a pledge total of 6.3 million.  A CNN correspondent interviewed many of the pledge’s largest signatories and found that to a large extent, the figure consisted of training programs that were already planned before Ivanka Trump arrived on the scene.  For example, the Associated Builders and Contractors pledged 500,000 opportunities over five years, approximately as many as the group trains each year in the ordinary course of events.

Bottom Line: It was a bad week for accurate reporting. Journalists erred in stating that the number of new jobs President Trump credited to his daughter exceeded the total created during the period. What legitimately deserved (and in some reports, to be fair, received) criticism was Donald’s calculation of the number of attributable to Ivanka’s efforts.


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