May jobs report beats expectations with 390K jobs added to the economy. FOX Business’ Edward Lawrence with more.
President Biden on Friday touted the better-than-expected May jobs report as evidence of the economy’s underlying strength, as he attempts to convince Americans that his administration engineered a successful economic recovery in the face of a souring public mood and roaring high inflation.
“I know that in the face of today’s good news, a lot of Americans remain anxious. And I understand the feeling,” Biden said from the White House. “There’s no denying that high prices, particularly around gasoline and food, are a real problem for people. But there’s every reason for the American people to feel confident we will meet these challenges. Because of the enormous progress we’ve made on the economy, the Americans can tackle inflation from a position of strength.”
SURGING INFLATION SQUEEZING SMALL BUSINESSES, GOLDMAN SACHS SURVEY SHOWS
His comments came after the Labor Department’s surprisingly strong payroll report, which showed that employers added 390,000 jobs in May, topping the 328,000 jobs forecast by Refinitiv economists. The unemployment rate, meanwhile, held steady at 3.6%, the lowest level since February 2020.
A customer shops at a store in New York, the United States, May 11, 2022. U.S. consumer inflation in April surged by 8.3 percent from a year ago, marking the second straight month of inflation over 8 percent, the U.S. Labor Department reported Wednes (Photo by Wang Ying/Xinhua via Getty Images / Getty Images)
“The job market is the strongest it’s been since right after World War II,” Biden said. “We got more evidence of that today.”
The administration is pivoting this month to quell voter unrest over surging inflation by signaling that Biden understands what U.S. households are enduring — and that officials are maximizing efforts to bring prices under control — ahead of the November midterms, in which Democrats risk losing their already razor-thin majorities.
HIGH INFLATION COULD BE ‘PAINSTAKINGLY SLOW’ TO COME DOWN
Just this week, Biden held a rare Oval Office meeting with Federal Reserve Chairman Jerome Powell, wrote an op-ed in the Wall Street Journal about his plan to tackle higher prices and sent his top lieutenants, including Treasury Secretary Janet Yellen, across cable news to tout his plan.
Biden reiterated on Friday that fighting inflation is his “top economic priority,” but once again tried to put the onus of bringing down prices onto the Fed, saying he is giving the central bank “room to operate.”
A Labor Department report last month that the consumer price index jumped by 8.3% in April, underscoring that inflationary pressures in the economy remain very strong. On top of that, gas prices hit another a record high on Thursday, with a gallon of gas on average now costing $4.71 — up 40% from just one year ago.
Most economists now expect elevated prices to persist throughout the year, worsening the political headache for both Biden and the Fed.
A Gallup poll released Tuesday showed that just 14% of Americans rate economic conditions as “excellent” or “good,” while nearly half — 46% — call them “poor.” Another 39% have said the economic landscape is “only fair.” That’s down from one month ago, when 20% of Americans rated conditions as good and just 42% said they were good.
The president has drawn flak, along with the Federal Reserve, for referring to inflation as transitory for months, even when it became clear the inflation spike was likely to last longer than expected. Biden has repeatedly blamed the price spike on supply chain bottlenecks and other pandemic-induced disruptions in the economy, as well as the Russian war in Ukraine. Republicans have pinned it on the president’s massive spending agenda.
U.S. President Joe Biden addresses the 76th Session of the U.N. General Assembly on September 21, 2021 at U.N. headquarters in New York City. ((Photo by Timothy A. Clary-Pool/Getty Images) / Getty Images)
When price increases continued, even as Democrats expected them to slow, the White House pivoted and started arguing that Democrats’ massive Build Back Better spending bill would help address cost pressure. But Sen. Joe Manchin, D-W.Va., has squashed that legislation, leaving Democrats spinning to find another defense against inflation.
Administration officials have since conceded they did not expect last year to unfold as it did.
“I think I was wrong then about the path that inflation would take,” Treasury Secretary Janet Yellen said Tuesday during an interview on CNN. “There have been unanticipated and large shocks that have boosted energy and food prices, and supply bottlenecks that have affected our economy badly that I… at the time, didn’t fully understand.”
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It remains to be seen whether Biden’s new strategy on the economy will prove effective with voters. It comes at an increasingly precarious time for the U.S. economy, as the Fed moves at the fastest pace in decades to raise rates and crush inflation. Policymakers voted last month to lift the short-term interest rate by 50-basis points and have all but promised that similarly sized hikes are on the table at upcoming meetings.
