First let’s remind ourselves of how many journalists and commentators practically lost their minds just a month ago after the report for April showed that the economy added only 266,000 jobs (revised upward Friday to 278,000). Because some economists had predicted a much higher number, it was called “dismal,” “disastrous,” “a huge letdown,” “a significant slowdown.”
For their part, Republicans acted as though President Biden’s economic approach had been discredited once and for all. Perhaps the single dumbest reaction came from Rep. Elise Stefanik (R-N.Y.), who called it “the worst jobs report in over 20 years,” despite the fact that, to repeat, the economy gained a quarter of a million jobs that month.
The actual worst jobs report in history came in April 2020, when the economy lost over 20 million jobs. I’m trying to remember who was president then; it’ll come to me.
The lesson, of course, is that one month’s numbers don’t tell you much, particularly if they’re a surprising reversal of an underlying trend.
And the trend at the moment is going in the right direction, not only on job growth but also on productivity, as economist Dean Baker explains. That could help keep inflation in check.
To put May’s 559,000 number in context, let’s look at data on non-farm payrolls from the Bureau of Labor Statistics. In the last 50 years before the current pandemic and recovery there had been only a single month — one — in which the American economy created more than May’s 559,000 jobs. It was April of 1978, when 702,000 jobs were created.
Of course we’re in a unique situation, because since the Great Depression we hadn’t experienced as steep an economic collapse as we did last spring, with pandemic-related closures pushing tens of millions out of work. As we bounced back from that initial shock, in some months the economy added back millions of jobs.
But we’re still significantly below where we were before the pandemic, which is why the Biden administration argues that we have to keep pushing the economy forward, with both the relief bill Democrats already passed and the infrastructure bill Democrats will almost inevitably have to pass alone.
And while no one can be sure what shape this recovery will take, Republicans are already insistent that our biggest problem is that lazy workers aren’t eager enough to return to low-wage jobs with poor working conditions and few benefits. Republican-run states have been in a mad dash to cut back unemployment benefits, on the theory that people aren’t desperate enough to take any job that’s available no matter what it is.
That raises a vital question: Exactly what kind of economy do we want to have?
The answer from Republicans is essentially that the overall trends of recent decades are just fine, and we shouldn’t do anything to change them.
Mind-boggling wealth inequality and enormous corporate profits along with tens of millions of Americans trapped in economic insecurity, struggling in low-wage jobs in health care, fast food, or fulfillment warehouses? As far as the GOP is concerned, that’s as it should be, and the only question for the moment is how to get all those people back to work.
Biden has started making the case that just creating jobs isn’t enough; equally important is whether those jobs pay well enough to support a family and offer dignity and respect. “Instead of workers competing with each other for jobs that are scarce, we want employers to compete with each other to attract work,” he said last week.
That would be a dramatic change, especially since it would shift power away from employers and toward workers. And there are lots of very wealthy interests (and an entire political party) determined to keep it from happening.
Even if we don’t know what will happen from month to month, we all know we’re headed for a strong recovery, at least by traditional measures of employment and GDP growth. But years from now we’ll judge ourselves by whether we created an economy where wealth wasn’t so concentrated and so many Americans weren’t consigned to lives without real opportunity and security. That would be a real economic achievement.