If all things were predictable there would be no need for last Friday’s Jobs Report from the US Department of Labor, but that clearly showed that despite expectations that there would be less jobs, in fact there were more, much more, 339,000 to be exact and that has given the White House joy, but more sleepless nights for Federal Reserve Chair Jerome Powell, as he wrestles with inflationary prices and employers that just keep on hiring.
Some salve to his battered nerves may be that unemployment has hit 3.7 percent the highest since October, showing that there is some slowdown in hiring, but is it enough? That might not be since adults at prime working age have barely changed over the last quarter.
Saying that the job market is tight is an understatement, saying that it is hot is closer to the truth, and employers are also being cautious, no major layoffs, and letting attrition reduce their workforce instead.
The Feds have raised interest rates for more than a year to cool the labor market and control prices, but we aren’t there yet; also, despite the Cassandras that have predicted an inevitable recession for the last several months, that seems to be in abeyance, though predictions of any accuracy are hard to state, at least with conviction.
The happy camper amidst all of the hand wringing is President Joe Biden, who in a statement issued from the White House, said: “Today is a good day for the America and American workers.”
It also serves to bolster his chances in the 2024 presidential election, as economic concerns are always at the core of many the average voter, despite a general misbelief that American presidents control the economy, and that the Federal Reserve Bank is a private bank.
There is sustained growth in education and health care, to the tune of 87,000 jobs; business services at 64,000 (though we find the term vague); government, including state and local at 56,000; and still growing is leisure and hospitality at 48,000, as Americans in the post Covid period have increased travel and dining out, leading us to wonder how many Covid era bread machines, pasta makers and espresso makers will gather dust in the nation’s cupboards.
For those that are the money folks, the good news is that accounting and bookkeeping have shot up to 64,000, and the outlier is construction at an increase of 25,000, somewhat of a surprise, because as The New York Times noted, “is sensitive to rising interest rates.”
They also reported that Tom Gimbel, founder and chief executive of LaSalle Network, a staffing and recruiting firm, saying, the “consensus seems to be . . . that the economy could continue to be strong for the next 24 to 30 months.”
That old bugaboo, labor force participation is little changed at 62.6 percent, and those prime earners don’t seem eager to look for work. Part of the reason, of course, is that as some edge closer to retirement age the pull for the daily grind is not as strong as it used to be,
It’s important to note that these reports are taken in the first two weeks of each month, and are subject to revision, and we have seen both March and April figures revised to 93,000.
Bad news for Black workers, still occupying most of the service jobs in the country, have an increased unemployment figure of 5.6 for May, countering the previous month’s decline, which we felt, in the final analysis, might be illusory.,
Overall, as in previous months this report presents a mixed bag for even the most sanguine observer, and despite the weak points shows a sustained patterns, but to lowball it might be a mistake, and there are those low wage earners who see that inflation can eat away at their wages, and some are predicting a decrease in wages that would cause some pain.
Wages were 0.3 percent last month, showing a slowdown from April, and this is an area that will be closely watched by Powell and the Federal Reserve.
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