President Joe Biden on Friday called for a “historic” return to the United States from the Covid-19 crisis, as the economy added 850,000 new jobs in June, limiting evidence of a massive recovery.
The optic was better than expected and came after two months of disappointing results, with big gains in hard-hit leisure and hospitality sectors, the Labor Department said in its closely monitored monthly report.
With the latest gains, the world’s largest economy added 3.3 million jobs in the first six months of the year.
“This is a historic breakthrough, bringing our economy out of its worst crisis in 100 years,” Biden told the White House.
The Democratic president cited the massive American rescue plan approved in March and the rapid acceleration of vaccination as reasons for economic revival.
“Our economy is moving forward and we are continuing Covid-19,” Biden said, although he acknowledged that more needs to be done.
The unemployment rate rose to 5.9 percent from 5.8 percent in May last year, data showed, and the unemployment rate for black workers rose to 9.2 percent from 0.1 percent.
The data also shows that the economy is still short of 8.6 million jobs compared to February 2020.
Biden called for more “critical investments” in infrastructure, including roads and bridges, as well as child care and higher education, in his American Jobs Plan.
“It will help us create better employment, reduce the burden on working families and strengthen our economy – strengthen it in the long run,” the president said.
– Increased wage shortage of workers –
Since the U.S. brought the epidemic under control, Americans have been able to play professional sports, travel, and eat, and celebrate weddings in person.
The sector recruited at a rapid pace, adding 343,000 posts last month, the report said. However, from the pre-epidemic level, it is still short of 2.2 million jobs.
Education at the state and local government level achieved 230,000 positions, and manufacturing achieved 15,000. But construction lost work and more workers saw their hours increase.
“Although today’s report was embarrassing with the 1 million expectation, it has consistently painted a picture of the market for recovered jobs,” said Lydia Bousser of Oxford Economics.
Noting that many organizations continue to make it difficult for people to fill open positions, he said the strong performance “will probably be the beginning of a great series of reports that will present the strongest economic performance in the United States since 1951.”
Labor shortages are also driving up wages, with earnings rising an average of 10 cents per hour in June to 40 30,040 after massive increases in May and April, the report said.
Biden said it advises a balance of power on behalf of dynamic workers and “empowers them to claim to be treated with dignity and respect.”
“More work, better wages. It’s a good combination,” he said.
Wall Street was interested in the “Goldilocks” report and investors feared that higher wages would spread uncontrolled inflation, with all three major indices posting new records before the July 4 holiday weekend.
– Mixed data? –
Nevertheless, with the resumption of business, the struggle to find workers has become a political issue, with Republicans blaming the liberal federal unemployment benefit in favor of keeping possible rents.
As a result, 22 state governments quickly shut down complementary unemployment benefits and announced plans to pursue four more state lawsuits, although some have faced legal challenges. Additional benefits are set to expire in September.
Robert Frick of the Navy Federal Credit Union rejected the rising unemployment rate, saying there were signs of good news ahead.
“Unemployment rates have intensified as more Americans are looking for jobs, and better employment for teachers will have a multiplier effect in the next few months, as children return to school and more than a million parents return to work,” he said of the data.
Meanwhile, for the first time since the onset of the epidemic, the broader measure of unemployment has dropped below 10 percent.
This “U6” rate – including those who work part-time because they can’t find a full-time job, as well as discouraged workers who aren’t looking for a job – fell just below 23 percent in April 2020.
Nevertheless, the statistics show some mixed results that include long-term unemployed – who have been unemployed for 27 weeks or more – returning after a decline in May.
And with employment in the auto sector falling by more than 12,000, economists say it is linked to a global semiconductor deficit that has hampered production, as well as the annual summer factory shutdown.
(Except for the title, this story was not edited by NDTV staff and was published from a syndicated feed))