The CEA’s Forecast Record
If you’re a regular visitor to this or Brad DeLong’s site, you probably know all about the White House’s unlikely forecast for job creation that was released this week. To put it in context, I thought it might be helpful to compare this year’s forecast of job creation by the White House’s Council of Economic Advisors (CEA) to the forecasts that they’ve made in previous years.
The picture below tells the story. It shows the predictions that the White House made in Feb. of 2002, Feb. of 2003, and Feb. of 2004, juxtaposed with what actually happened in the US job market from 2000 to 2003. All figures are annual averages and are taken from the Economic Report of the President.
It seems that, in fairness to the White House, this year’s forecast is no more optimistic than any previous year’s forecast. Will be just as far off? Probably not… but it will be surprising if it’s right, too.