Popular Economics Weekly
Total nonfarm payroll employment rose by 227,000 in November, and the
unemployment rate changed little at 4.2 percent, the U.S. Bureau of Labor
Statistics reported
today. Employment trended up in health care, leisure and hospitality,
government, and social assistance. Retail trade lost jobs.
It looks like the American economy that so many voters thought was not
working for them has now brought the unemployment rate down to 4.2 percent from
its 14.8 percent high in April 2020 (peak of red line in graph) during the
COVID-19 pandemic.
This is despite the labor strikes by Boeing employees, East Coast
dockworkers, railroad workers and several hurricanes that devastated parts of
the south.
President Biden touted the results in the next to last unemployment report of
his administration. It took much longer to get there after the Great Recession
(large gray bar) in the FRED graph dating from 2010 that included the Obama and
first Trump administrations.
“America’s comeback continues,” he said in
a statement. “Today’s report shows that the economy created 227,000
jobs in November, as Boeing machinists returned to work with record wage gains
and hurricane recovery continued. Unemployment of 4.2% is in the same low range
of the past seven months. This has been a hard-fought recovery, but we are
making progress for working families.”
Hurricanes Milton and Helene prevented more than a half million people from
going to work in October, said MarketWatch’s Jeffry Bartash, but most of them
were back on the job last month. The number of people who said they could not
work because of bad weather in November fell to just 62,000 from 512,000 in the
prior month.
Almost all sectors showed job increases: Education/Health +79,000,
Leisure/hospitality +53,000, Government +33,000, and manufacturing + 22,000 in
payroll jobs.
This could not have happened without the various policies enacted over the
past four years of the Biden Administration when more than 15 million jobs were
created that brought the American economy out of the COVID-19 pandemic, the
worst natural disaster in more than 100 years.
The truth is that it could have been much worse if the pandemic recovery
hadn’t been a public/private collaboration. The $5 trillion in the various
Bidenomics’ legislation enacted by a bipartisan congress put those investments
into productive enterprises, such as modernizing our infrastructure and
manufacturing base, as well as mitigating the results of global warming by
investing in alternative energies like solar, EVs and wind generation.
Many Americans have suffered horrendously from the hurricanes and record
number of tornadoes that have devastated parts of the south and Midwest. Climate
change has not proven to be a ‘hoax’, so I am hopeful that the upcoming
Republican administration in their drive for more efficiency will not eliminate
those programs that have helped these regions to recover. Many of the worst-hit
areas are in Republican-run red states.
All eyes are now riveted on whether the Federal Reserve will drop interest
rates another 0.25 percent in its December FOMC meeting, which will boost growth
further.
Prominent economist Mohamed El-Erian has described today’s jobs release as “a
somewhat strong report, but not consistently strong,” adding that it should pave
the way for an interest-rate cut by the Federal Reserve later this month.
“It is strong on the earnings side. It is strong on the labor
participation coming down side — less supply — and is also strong on a small
beat,” he told Bloomberg TV. “But the fact that the unemployment rate went up
means that the Fed will be comfortable cutting by 25 basis points, means that
the market will increase the probability of this happening. So on the policy
front, this did not complicate what would have been a messy situation.”
I am hopeful after COVID-19 that the next administration will know enough not
to cut too much meat off the government’s bone mitigating climate change when
another natural disaster might loom, such as a bird-flu pandemic that scientists
are now saying is a possibility.
Harlan Green © 2024
Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen
