One bit of news in the report especially caught my eye: nominal wages grew 2.9 percent in 2016 (December-to-December), their fastest growth pace since mid-2009. That’s evidence that the tight job market is doing the thing I consider to be most important: creating more bargaining clout for workers. When unemployment gets and stays low enough, employers have to bid up wage offers to get and keep the workers they need. Unlike the Fed, I don’t think we’re quite there yet, i.e., at full employment, but we’re close, and that’s helping working families.

Now, this being Washington at a point just weeks away from a new and very different presidential administration taking power, such numbers quickly get thrown into the political mix. But let’s resist that for a moment, based on the following truth: Outside of recessions, when countercyclical policy — stimulus, unemployment insurance, etc. — is of tremendous import, presidents have a lot less to do with the good economic news for which they take credit and the bad news for which they get blamed.

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I give the Obama administration and the Fed great credit for their interventions during the Great Recession, which demonstrably helped to turn the tide more quickly than would have otherwise been the case (Full disclosure: I served in the administration in the early days). But those who foolishly claim the government doesn’t create jobs are simply ignorant of the facts: There are 22.2 million government jobs in the United States. Moreover, as economic recoveries mature, the forces that create jobs are many and varied, and while government policy is always in the mix, it is not nearly the dominant force people in this town tend to think. (The Fed is another story, which I won’t get into here but have extensively elsewhere; see chapter 4 here.)

So, what is important? What are those forces behind the 15 million jobs created since payrolls begin consistently expanded in late 2010?

The fundamental principle of job growth is derived demand. That is, employment growth is derived from the demand for the services and goods that people want to consume and invest in. I’m talking about haircuts and factories, salamis and laptops, vacations and roads, homes, dogs, cats, clothes, cars, and on and on and on. In the most recent quarter, consumer spending was about $13 trillion, almost 70 percent of GDP. Private investment, including housing, was another 16 percent; government (at all levels), makes up the rest (I’m leaving out foreign trade for a moment).

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When we economists go on about “demand,” as in “we need more demand in this recovery,” this is what we’re talking about. The more people are able to consume and invest to meet their needs and wants, the more jobs (I realize this sounds both hyper-acquisitive and non-green; but it need not be, at least re the latter: People can consume green/renewable energy, mass transit, etc.). The more jobs, the tighter the job market. The tighter the job market, the greater the bargaining power of low- and middle-class workers. The greater their bargaining clout, the better the chance they’ll see some of the benefits of their labor show up in the paycheck, as we’ve finally seen occurring in recent months.

Now, let’s get back to policy. What does Washington have to do with any of the above?

I’ve already mentioned the countercyclical role but we’re now able to put that in context: When private sector demand collapses, the federal government must step in and temporarily replace the lost demand through stimulus spending. But what about in mature economic expansions, like this one?

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Well, for one, policymakers must ask: Is the recovery reaching everyone? In fact, there are groups of workers, including minorities and those in certain parts of the country, that consistently face demand shortfalls. That’s why even with unemployment below 5 percent, it would be useful now to invest in public infrastructure, as that could help pull more sidelined, prime-age workers into the job market (it could also probably help boost productivity growth, by improving the quality of transportation infrastructure critical to supply chains). However, if we want the best bang for the buck, we need a program unlike the one Trump has promoted, which relies not on direct spending but on tax credits for projects with user fees.

Next, it is worth noting that while demand creates jobs, it doesn’t necessarily create good jobs. Here policy is essential. Labor standards like minimum wages and overtime, union representation and the extent of the trade deficit are all important.

Regarding that last point, team Trump has, to its credit, elevated the issue of international trade and neatly connected it to the demand for good, high-value added factory employment. But while these are still early days, we’ve yet to hear any good ideas to reduce our persistent and economically large trade imbalances. Tweet-shaming China and threatening trade wars won’t work. When Trump says he wants to renegotiate the North American Free Trade Agreement or the Trans-Pacific Partnership, it’s not at all clear to me on whose behalf he’s planning to negotiate. By the looks of his hugely regressive tax cuts, it’s not the displaced workers on the wrong side of globalization.

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Which brings me to my final point. Presidents may have a lot less to do with job growth in a mature expansion than in a recession, but they can definitely screw things up (or, slightly more technically, squelch demand) especially when they’re guided by ideology, thin skin and crony capitalism that pays back their funders. High tariffs, trade wars, wasteful tax cuts, deregulating financial markets (thus tempting future recession-inducing bubbles), whacking the safety net and breaking the health insurance market all come to mind.