Biden Badly Misses Expectations Again With New Jobs Report
There’s a four-word expression that seems to be used a lot when it comes to Joe Biden and, in particular, his actions when it comes to the economy — fails to meet expectations.
How many times have we heard this when talking about the jobs report under Biden?
Well, here we are again. It’s October and now the September numbers are in and they “fail to meet expectations.”
When even CNN has to say how bad it is, you know it’s bad.
Here they are saying it’s “way less than expected,” less than last month, and “the worst of the year.”
According to CNBC, non-farm-related jobs rose by just 194,000 when it had been expected to rise by 500,000. A very big failure, less than half of what was expected. Not a good look.
The unemployment rate dipped slightly to 4.8%, the DOL added, but the latest hiring data comes after dismal job growth seen in August as well. Some 366,000 jobs were added in August, according to revised data released on Friday, and over a million jobs were added in July.
The overall labor force dropped by 183K, almost the same amount of new jobs, and the number of those not in the labor force also grew by 338,000. Stephanie Pomboy, founder of the economic research firm Macro Mavens said, “183,000 people dropped out of the labor force in September. That’s an amazing number, and it’s not a good one.”
While there were some gains in the hospitality area, part of the problem was a sharp drop in government employment. Is that related to vaccine mandates, one has to wonder? Both local government education (-144,000) and state government education (-17,000) lost jobs last month, according to Fox. CNBC also pointed to “declines in nursing,” raising the question there, too, about mandates perhaps affecting that arena as we see governments and hospitals promoting mandates. “Not the numbers you need to put people back to work,” CNBC’s Steve Liesman concluded.
“This is quite a deflating report,” said Nick Bunker, economic research director at jobs placement site Indeed. “This year has been one of false dawns for the labor market. Demand for workers is strong and millions of people want to return to work, but employment growth has yet to find its footing.”
Unfortunately, he’s made everything worse with the moves that he’s taken so far including previously having the continuing unemployment benefits that made it more profitable not to work. Now, he’s not doing anything that’s likely to make it better and indeed his further imposition of mandates is likely to make it worse in the coming months.
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The Bureau of Labor Statistics (BLS) has released the September jobs report [DATA HERE] showing a dismal 194,000 jobs added against a financial media and Wall Street expectation of 500,000 jobs. [CNBC Apoplectic] The labor participation rate in the worker economy overall has not moved since Biden’s inauguration, and stands at 61.6%.
Digging into the numbers, what is happening is exactly what we ¹should expect. Outside the immediacy of private sector durable goods retailers seeing a pull back in consumer purchasing due to inflation (which we continue to point out is the critical issue); the local economies impacted by a declining tax base are key early indicators of contracting economic activity. Wage gains are not keeping up with inflation.
Inside the data, you will note [Table B-1] a significant decline in Local Government Education of -144,000 jobs. Obviously the collapse of in-school teaching leads to less jobs in this sector overall. However, the drop happened at the exact same time students were returning to a new school year, and this drop is also reflected year-over-year. Schools were impacted by COVID in Sept 2020 more than schools are impacted by COVID in Sept 2021, yet this year the jobs are completely gone. Something bigger is happening in this sector.
Additionally, healthcare services show a major drop in employment (-37k) specifically as it relates to elderly care and nursing homes. All the sub-sectors of elder care are significantly lower in employment.
Retail was essentially flat (+56k) considering the scale of the sector; and durable goods within the retail sector show declines in employment. Again this would indicate less consumer spending on durable goods, as food and energy inflation are prioritizing spending habits. Leisure and Hospitality (+74k) with hotels and restaurants doing the majority of the hiring as the rebound in this sector continues.
[¹Here it is important to note a slow cascade effect that will take time and we are not near the peak of the trouble yet. As a historic reminder, the epicenter of the peak financial crisis (housing) was triggered in Nov/December 2005. However, the trouble was not visible on a national scale until 2007. Economic data shows the current triggering event took place in May/June of this year. Make of that what you will]
(CNBC) […] The U.S. economy created jobs at a much slower-than-expected pace in September, a pessimistic sign about the state of the economy though the total was held back substantially by a sharp drop in government employment.
Nonfarm payrolls rose by just 194,000 in the month, compared with the Dow Jones estimate of 500,000, the Labor Department reported Friday. The unemployment rate fell to 4.8%, better than the expectation for 5.1% and the lowest since February 2020.
[…] “This is quite a deflating report,” said Nick Bunker, economic research director at job placement site Indeed. “This year has been one of false dawns for the labor market. Demand for workers is strong and millions of people want to return to work, but employment growth has yet to find its footing.” (read more)
[INFLATION] is terrible for wage earners in the U.S. who are now seeing no wage growth and higher prices. Real wages are decreasing by the fastest rate in decades. We are now in a downward spiral where your paycheck buys less. As a result, consumer middle-class spending contracts. Eventually, this means housing prices drop because people cannot afford higher mortgage payments.
Gasoline costs more (+50%), food costs more (+10% at a minimum) and as a result, real wages drop; disposable income is lost. Ultimately this is the cause of Stagflation. A stagnant economy and inflation. None of this is caused by COVID-19. All of this is caused by economic policy and monetary policy sold under the guise of COVID-19.
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