NEWS ANALYSIS : Clinton Staff Cautious Over GDP Growth : Recession: Incoming Administration is taking a wait-and-see attitude on an economic recovery.

Despite growing optimism across the country about the economic outlook, President-elect Bill Clinton’s advisers appear to be keenly aware of the dangers of falling into the same trap that contributed to George Bush’s defeat: mistaking gradual growth for a broad-based recovery that puts Americans back to work.

For more than a year, the Bush Administration hailed reports of modest growth in gross domestic product, the basic measure of the nation’s output of goods and services, as proof that the economy was on the mend and that more aggressive White House action was not needed.

But the problem the outgoing Administration failed to fully address was that the economy was not growing sufficiently to create many jobs and that some specific sectors were still in the throes of recession and restructuring. Those factors repeatedly combined to stifle the recovery, persuading Americans that things were considerably worse than Bush was willing to admit. Bush looked indecisive and even uncaring and that made many Americans angry when they went to the polls on Nov. 3.

Now, faced with stronger, post-election GDP numbers but stubbornly high unemployment and a series of worrisome corporate layoff announcements, Clinton’s advisers seem to have learned a lesson from Bush’s mistakes. They say they want to see persuasive gains in employment before concluding that a vigorous recovery has begun and that a short-term economic stimulus plan is unnecessary.

“There have been a couple of false dawns” over the last two years when the economy failed to pull out of its torpor, Clinton’s chief economic adviser, Robert Reich, said in an interview Thursday.

“Bill Clinton campaigned on a promise to restart the economy, and until the job situation shows signs of real improvement,” it will be difficult for Clinton to declare a recovery, Reich added.

However, signs of life on the job front have been few and far between. Although the government reported last week that the nation’s output of goods and services grew at a 3.9% pace during the third quarter, it is not yet clear that increased output has translated into many new jobs.

The nation’s jobless rate has remained stubbornly high. And, while a decline in the unemployment rate usually lags a recovery, in recent months it has actually stayed above the levels posted during the depths of the recession in early 1991. In October, the unemployment rate was 7.4%, down only slightly from the eight-year peak of 7.8% posted in June.

A recovery without rising employment can’t be sustained. Unless the economy begins to generate more jobs, incomes of Americans won’t rise, and consumers won’t be able to spend more.

One key piece of evidence will emerge today, when the government reports the November unemployment figures. Those numbers will come under close scrutiny at Clinton’s headquarters in Little Rock.

Many economists, increasingly cautious about declaring an end to the slump, now agree that signs of life on the job front will be the best barometer of a lasting recovery. And they believe that Clinton is smart to wait to see if the economy begins to generate more jobs before deciding whether to go ahead with a stimulus program.

Forecasters expect to see some modest improvement in employment in Friday’s figures. While they aren’t counting on much of a drop in the unemployment rate, many economists say that the report should show that the economy added about 75,000 jobs during November.

That is still not enough to declare a full recovery, economists added, but it would suggest that the increased output that showed up in the third quarter is beginning to have an impact.

For Clinton, the confusing economic outlook raises new questions about how best he can balance his seemingly conflicting objectives of rapid economic recovery and serious deficit reduction. Clinton, who met with Federal Reserve Board Chairman Alan Greenspan on Thursday to discuss the economy over lunch, clearly hopes that the recovery begins to blossom so that he can drop plans for a quick economic stimulus and focus his attention on his long-term economic agenda, which is highlighted by investments in such areas as job training, education and public works. He would also like to tackle the deficit.

But that could raise political questions about whether Clinton would then appear as if he was not being aggressive enough on the economic front. After campaigning against Bush’s do-nothing economic policies, can Clinton avoid taking quick action?

Many Bush Administration officials are frustrated that the better economic data only began to emerge after the election, but at least a few are still enjoying the irony of the situation that confronts Clinton.

“It turns out we had stronger economic growth than we thought,” one Bush Administration official said. “But for Clinton, there is this real problem--how can he come out and say things are better, and that we don’t need a recovery program? If he doesn’t have to do an Economic Recovery Act of 1993, how can he take credit for the recovery of 1993?”