Employers across a range of industries have complained that it is difficult to find workers, even though millions of Americans remain unemployed. Republicans have alleged this is primarily the consequence of the trillions of dollars in government aid that Congress authorized in response to the coronavirus over the past year.
But Democrats argue that the federal dollars helped people in greatest need and helped stave off an even worse economic decline. They increasingly say that any disruption in the labor market is probably the result of employers that have tried to lure people back with low wages, on top of troubles facing families that continue to struggle to find adequate child care.
White House officials privately have been scrutinizing economic data to see if reports of a labor shortage are simply anecdotal or something more structural that needs to be addressed. On Thursday, though, deputy White House press secretary Karine Jean-Pierre mounted a fresh defense of the Biden administration’s economic agenda.
In a briefing with reporters aboard Air Force One, she said the recent rescue package had put more money in the pockets of Americans who are out of work and families struggling to make ends meet. And she said there is “little evidence” that enhanced unemployment benefits in particular “are currently affecting Americans’ willingness to work.”
The war of words reflects lingering schisms over President Biden’s first major legislative accomplishment, which Republicans in Congress unanimously opposed out of a belief that such a sizable package was not needed in the first place. The state of the labor market, along with threats of inflation, have become one of the biggest flash points in the economy.
But their contrasting views carry broad political significance at a time when the Biden administration has called for roughly $4 trillion in additional spending spread across two packages that define his economic agenda. McConnell’s criticisms in particular follow a day after the Senate GOP leader said his primary goal is thwarting Biden’s efforts.
The first of those two packages, the American Jobs Plan, targets upgrades to the country’s roads, bridges and other infrastructure, while the second, known as the American Families Plan, spends significant sums to improve child care, education and other federal aid programs. The two endeavors have touched off a fierce debate due to not only their price tag but the extent to which that level of federal spending could grow the economy without overheating it.
In response to the concerns about a worker shortage, White House officials have said in recent days that the data they have collected about job postings, applicant demand and worker wages do not suggest a major worker shortage is afoot. In the meantime, the Biden administration received some positive labor news Thursday, after the government reported that weekly claims for new unemployment benefits fell for the fourth week in a row as the country continues to reopen.
A clearer snapshot of the labor market could come Friday, when the Bureau of Labor Statistics issues its April jobs report.
With inflation, meanwhile, the Biden administration itself sounded the early alarm bells about rising prices Tuesday, when Treasury Secretary Janet Yellen said the president’s spending plans could force the country’s central bank to raise interest rates. Yet Yellen later clarified her remarks, telling the Wall Street Journal she did not “think there’s going to be an inflationary problem.”
Jeff Stein and Tyler Pager contributed to this report.