(The Center Square) – A new federal jobs report released Friday showed that job creation for the month of August fell far short of expectations.
The Bureau of Labor Statistics report showed nonfarm jobs increased by 235,000 with unemployment at 5.2%. Dow Jones economic experts expected 720,000 new jobs for the month.
“The number of unemployed persons edged down to 8.4 million, following a large decrease in July,” BLS said. “Both measures are down considerably from their highs at the end of the February-April 2020 recession. However, they remain above their levels prior to the coronavirus (COVID-19) pandemic (3.5 percent and 5.7 million, respectively, in February 2020).”
Last month’s job creation was less than half the average for the year, with the economy creating an average of 586,000 jobs monthly in 2021.
“In August, notable job gains occurred in professional and business services, transportation and warehousing, private education, manufacturing, and other services,” BLS said. “Employment in retail trade declined over the month.”
The weak jobs report drew criticism from Republicans, many of whom are fighting to end federal unemployment benefits. They argue that when combined with the normal state benefits, the federal weekly payments are incentivizing Americans to stay out of the workforce.
“There’s more than just COVID behind this terrible jobs report,” said Rep. Kevin Brady, R-Texas, the ranking member on the House Ways and Means Committee. “President Biden’s ‘worker-less recovery’ is hammering both Main Street and families as businesses fight to fill jobs and families struggle with rising prices. No wonder the recovery is stalling, and consumer optimism has dropped alarmingly.”
Republicans have also pointed to elevated government spending as a driving cause of inflation and poor economic health.
In June, the consumer price index, a major measure of inflation, saw its most significant one-month increase since the 2008 financial crisis. An array of goods and services have become more expensive in recent months, notably gasoline and used vehicles, both of which saw prices jump more than 40% in the last 12 months.
“The all items index rose 5.4 percent for the 12 months ending July, the same increase as the period ending June,” the Bureau of Labor Statistics said. “The index for all items less food and energy rose 4.3 percent over the last 12 months, while the energy index rose 23.8 percent. The food index increased 3.4 percent for the 12 months ending July, compared to a 2.4-percent rise for the period ending June.”
These critiques will likely come into play as Congress returns this month to take up Biden’s several trillion dollars in proposed federal spending.
“Higher wages in August will almost certainly be swamped by higher prices due to government spending and lack of workers,” Brady said. “Which will only get worse if the Democrats’ trillions in tax hikes and welfare spending is rammed through Congress in September.”
By Casey Harper | The Center Square
