Stock Groups

Biden focuses on unemployment rate

Joe Biden (US President) speaks from the State Dining Room in Washington DC about November Jobs Report on December 3, 20,21.

Getty Images| AFP | Getty Images

WASHINGTON — President Joe Biden glossed over the weak November jobs report Friday, instead focusing on the low unemployment rate and the yearlong trend of growth and economic recovery.

U.S. economics created far fewer jobs than expected in NovemberThe Labor Department earlier reported that the slowdown in hiring was evident even before the release of the new variant of the omicron Covid.

Payrolls for nonfarm workers increased by just 210,000 for the monthHowever, the unemployment rate declined sharply to 4.2% (from 4.6%). In March 2020, the highest monthly level of labor force participation was 61.8%.

Biden omitted almost all of the information about job creation during a White House speech, officially described as remarks on November’s jobs report.

He said, “Today we received the amazing news that our unemployment has fallen to 4.2%.” “And this is the fastest one-year decrease in unemployment since records began.”

Multiple factors could explain the disparity in the stark decline of the unemployment rate and weak job growth.

CNBC Politics

Continue reading the CNBC politics coverage

Many economists pointed out that the payroll count used for estimating the new job creation is not the same as the household survey, which was used to calculate the unemployment rate. This could be partly due to the different surveys used for calculating the unemployment trend.

People are asked to answer a monthly Bureau of Labor Statistics household question whether or not they have a job. Many Americans created small businesses out of their homes during the epidemic. These people will likely be considered employed by the Bureau of Labor Statistics household survey even though they may only have one or two workers.

The headline number of monthly jobs is, however, based on payroll reports for approximately 150,000 large businesses and government agencies. This survey might not include the thousands of entrepreneurs that started small businesses within the past 2 years.

This is because the employment growth number suggests that there has been a slower recovery than the unemployment rate.

You can see why President Obama chose to emphasize the unemployment rate rather than the number of jobs, something he mentioned only once. Biden noted also that the initial job totals for this year saw substantial upward revisions.

Report released Friday showed that the September and October estimates had been bumped to 82,000 each.

Biden stated that “Because of the remarkable strides made, we are able to look forward towards a brighter and happier new year.”

The president acknowledged the positive progress in the previous year but did not hesitate to speak out about the anxiety of voters over inflation, supply chains issues, and Covid.

“Families are anxious,” said he. They are still uncertain about Covid and anxious about living costs. It is important to me that you know I care. You can’t just know we are making progress. It’s important to feel and see the progress in your life, at your table, and in your bank accounts.

The combination of weaker-than-expected job numbers and worries that a higher unemployment rate might convince the Fed into increasing its tapering efforts led to stock losses.

CNBC spoke with Gina Raimondo, Commerce Secretary. She said that investors need to look at the whole picture and not just one month. This year’s job growth has exceeded 6.1 million. The 2021 average gain of 555,000 per month (not including November) positions the U.S. economy for full recovery from the pandemic — or matching the Feb. 2020 unemployment rate of 3.5% — by the end of 2022.

It is much earlier than economists thought.

The largest gains were seen in professional and business services (90,000.), transport and warehousing (50.000) and construction (31,000). Retail saw a drop of 20,000 despite the approaching holiday shopping season. The government added 10,000 new jobs.

Workers’ wages rose by 0.2% in November compared with a year ago. They also increased by 4.8%. Both were slightly lower than expected.

Biden declared, “We’re heading into the holiday season with strong form.”

This report was contributed by Jeffrey Cox, CNBC

Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.