Peeking behind the curtain, showed that there was some wizardry at work, but also that there was still a lack of consumer spending, but also a substantial measure of saving by most Americans. If this seems like a conundrum, then that nod to reality is paramount in a country with the highest infection rates of COVID-19, and deaths worldwide.
While the country continuously disapproves of President Trump’s handling of the pandemic, it also needs economic help to stay afloat, now that all pretense at a V-shaped recovery has disappeared, during those early days of March, when America thought that it could make it past what was believed to be a hurdle.
1.4 million non-farm jobs were created, or maybe the better word is held, since much of those were the temporary census jobs, and while this was within the predicted range, it’s better than hoped for, but less than deserved, and while the unemployment rate of 8.4 seems to also be a targeted range, once again, it is a less reliable than the household, or U-6 survey which shows a higher range, despite seeking 14.7 in April and 10.2 in July.
For those looking for light at the end of the tunnel, fresh batteries for the flashlight might be in order, as payroll figures are well below pre-pandemic levels, and the July figure of 1.7 million still shows that there is work to be done.
While Speaker of the House, Nancy Pelosi might feel that there is still need for a stimulus bill, the fourth totalling $3.2 trillion, previously rejected by the White House, and Republicans, this report might give more support to the latter’s concerns about increasing the national deficit, and might be a no-go to her wishes, and a plank in the non-existent Trump election platform.
The Federal Reserve chair, Jerome Powell, commented, in a Washington Post story,“Today’s jobs report was a good one,” and “… We’re not really going to know the pace of the speed of the recovery with any clarity for a couple more months. But certainly the healing in the jobs market continues apace.”
And, in earlier remarks he also expressed hope that the Federal government would step up and provide the necessary relief needed. And in a later interview he soft-pedaled exactly who should give that relief, but most observers felt that he meant from the federal level.
“It could be years before the central bank raises interest rates above a “low” level, Jerome H. Powell, the chair of the Federal Reserve, said on Friday, a sign of the Fed’s steadfast view that the economy, while slowly recovering, will need extraordinary support for an extended amount of time given the pandemic, reported The New York Times.
The Labor Force Participation Rate was 0.3 percent, (to 61.7 percent in August but is 1.7 percentage points below its February level), and as Chicago based Challenger, Gray and Christmas said in a statement, on Thursday, “jobs cuts announced by U.S.-based employers in August totaled 115,762, 116% higher than the August 2019 total of 53,480.”
This total “is 56% lower than the 262,649 job cuts announced in July, It is the highest total in August since 2001, when 118,067 job cuts were announced.”
The largest area was transportation, as airlines began to make these decisions, and on Wednesday, NPR reported, “United Airlines will be putting 16,370 workers on involuntary, indefinite furlough at the start of October unless more aid materializes from the federal government, the company announced Wednesday.”
“Together with some 7,400 voluntary departures, the airline is cutting its workforce by more than 25%. It's hardly alone. American Airlines recently announced 19,000 furloughs and layoffs, while Delta cut its workforce by 20% through buyouts.”
Add this to the list of retail outlets such as the old-guard Lord and Taylor, closing all 38 of its stores, and we have the perfect storm.
It seems highly unlikely that Congress and the White House and the GOP majority in the Senate will move ahead, beyond the temporary $300.00 added by Trump to aid some families, and individuals, is needed, to say the least; and, the reality of rent, and groceries are still a harsh reality.
“The longer people don’t pay their rents, the further down the value of real estate goes, the threat to banks that are holding obligations in that area goes up,” said William E. Spriggs, chief economist to the AFL-CIO and a professor at Howard University. “If this keeps up, we get to January and we start seeing financial stress, we’re in more than deep trouble, reported The Washington Post.
While in the last quarter of 2019, we noted that women were the ones rewarded on the hiring end, the picture has begun to change, and “Women now make up about 49.8 percent of non-farm jobs, down from 50.04 percent in January. They also are experiencing higher rates of unemployment, 8.4 percent, compared with men, at 8 percent,” they added.
“Employment in leisure and hospitality increased by 174,000 in August, with about three-fourths of the gain occurring in food services and drinking places (+134,000). Despite job gains totaling 3.6 million over the last 4 months, employment in food services and drinking places is down by 2.5 million since February,” the report noted, and no doubt, to many, much of the downward trend was with women workers.
Worth noting in these racially perilous times is the Black unemployment rate of 13 percent, a slight decrease by one point from July, but is still significantly greater than the white unemployment figure of 7.3 percent, representing continued racial inequality.
In the nearly six months after the peak of the pandemic, American struggles to have a rebound with this economy but is hampered, and will be for some time, with the economic consequences. That has been devastated by COVID-19, and “the nearly 1 million people who keep applying for unemployment each week point to a sluggish pace of improvement,” reported Associated Press.
With increasing furloughs and layoffs, from retail and also automotive, with Ford trying to shrink its white-collar by 1,400 it's easy to see that many of these vacancies are becoming permanent.
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