With the nation's jobless rate edging downward and news Friday that the economy grew at a 2.8 percent pace in the fourth quarter, it's possible that the state of the economy may now be transforming from a political millstone into less of a losing issue for President Obama.
But Obama is still struggling with low approval ratings, and forecasters generally envision a tight race for the White House, with still-high unemployment offsetting Mr. Obama's status as the incumbent.
It certainly doesn't look like he'll coast to an easy win.
Consider that in the time period since 1948 (for which monthly unemployment data are available) only one incumbent president has won reelection with joblessness over 7 percent. That was Ronald Reagan in 1984. Today the unemployment rate is higher than it was then, and many economists expect it to remain above 8 percent through much or all of 2012.
But here's another data point to consider: No incumbent seeking reelection has lost with unemployment falling for two years prior to the vote.
It may be the relative direction of the economy, rather than the absolute level of unemployment, that most determines voters perceptions of how a president is doing on pocketbook issues.
If that's the case, Obama's reelection hopes look brighter.
When Reagan was reelected, joblessness was high but had been falling for two full years.
When George H. W. Bush lost in 1992, unemployment had barely begun to edge down after a recession the year before. When Gerald Ford lost in 1976, the jobless rate was falling for about a year and half. Another big factor in that vote: Americans were disillusioned with Washington after the Watergate scandal, and outsider Jimmy Carter promised change.
Obama can point to more than two years of decline in the jobless rate, with more than nine months still to go before the election. (Unemployment peaked at 10 percent in October 2009.)
At the same time, what's distinctive is the depth of the recession from which the nation is still recovering. It was the worst since the Great Depression of the 1930s.
The president chose his words carefully earlier this week in a State of the Union speech that was, as much as anything, an official launching point for his year-long campaign. "The state of our Union is getting stronger," he said, acknowledging the financial stress millions of Americans feel but pointing to progress in job creation and factory-floor expansion.
“The President did not cause the economic and fiscal crises that continue in America tonight," Governor Daniels said. "But he was elected on a promise to fix them, and he cannot claim that the last three years have made things anything but worse: the percentage of Americans with a job is at the lowest in decades."
It's true that the number of employed Americans, as a percentage of all working-age people, so far hasn't begun to revive significantly from the devastating impact of the recession. The population is growing, and unemployment has fallen in part because of people finding new jobs, and partly because so many people aren't even looking for work.
In recent months, consumer confidence has revived somewhat but remains at a very low level.
Still, an NBC News/Wall Street Journal poll released this week found that for the first time in seven months, more people approve of Obama's job performance than disapprove, at 48 percent to 46 percent.
Among registered voters, 55 percent would choose Obama over Mr. Gingrich (at 37 percent) in a head-to-head vote today, the poll found. They favored Obama over Romney by 49 percent to 43 percent.
At the same time, many forecasters see the economy remaining relatively weak throughout the current year, with GDP growth running generally below the 2.8 percent pace seen in the fourth quarter.
Even signs of improvement in the job market could carry a risk for Obama, some political analysts say.
"This little bit of good news is likely to raise the hopes of the great army of the discouraged – many of whom will now start looking for work," writes Robert Reich, an economist and former Labor Secretary under President Clinton, in a recent blog post. "And what happens when they start looking? If they don’t find a job (and, let’s face it, the chances are still slim) they’ll be counted as unemployed."
Mr. Reich says the unemployment rate could tick upward in coming months. Even if it doesn't, many economists don't see a big additional decline in the jobless rate this year, partly for the reason Reich outlines.
All this leaves the economy, and voter perceptions of it, as a major question mark for the 2012 election. It's too soon to say it will become a winning issue for Obama. But the signs also suggest Republicans shouldn't be feeling overconfident.