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Biden Celebrates Drop in Unemployment Even as Job Growth Weakens By Bloomberg

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© Bloomberg. Joe Biden, October 8. Photo by Stefani Reynolds/Bloomberg

(Bloomberg.) President Joe Biden celebrated a fall in the unemployment rate, while U.S. job gains in September were at their slowest this year.

“Today’s report has the unemployment rate down to 4.8%, a significant improvement from when I took office and a sign that our recovery is moving forward, even in the face of a Covid pandemic,” Biden said Friday at the White House.

According to Labor Department data, although the unemployment rate was at a record low of 4.8% in September, this is partly due to thousands of Americans who, particularly women, quit the labour force and abandoned looking for employment. September’s report showed a 194,000 gain in payrolls, weaker than all but one of 71 forecasts in Bloomberg’s survey. Companies sought to attract workers, so wages rose.

Predictably, the report prompted a partisan response. Nancy Pelosi (House Speaker) said that the release demonstrated the necessity for the Democrats to create a broad social spending package. Pelosi stated in her statement that the bill would create jobs in education, health care and clean energy.

Republican lawmakers, on the other hand, claim that federal support is going to reduce Americans’ willingness to apply for job openings.

‘Worker Shortage’

“We are in the midst of a worker shortage crisis and the number of potential workers is shrinking. Multi-trillion tax and spend proposals in Washington will only make matters worse,” U.S. Chamber Executive Vice President and Chief Policy Officer Neil Bradley said in a statement on the September jobs report.

Biden’s longer-term economic proposals have stalled in Congress, with progressive Democrats withholding support for a bipartisan infrastructure package pending a deal with moderates on the social-spending bill. White House attempts to broker an agreement that balances liberal policy priorities with centrist concerns over inflation and tax rises.

“Turn on the news and every conversation is a confrontation,” Biden said. “Every disagreement is a crisis. But when you take a step back and look at what’s happening, we’re actually making real progress. Maybe it doesn’t seem fast enough.”

The slowing job growth over the past few months is a sign of an ongoing tug of war between American workers who are not returning to work and employers. Economists believe that school reopenings, as well as the ending of federal expanded unemployment benefits, will lead to an increase in hiring over time, at a moment when employers are increasing pay.

©2021 Bloomberg L.P.

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