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The US economy added fewer jobs than expected, and the unemployment rate continued to go up and stood at 4.3 percent in July.
While hiring slowed compared to recent months, the economy still added 114,000 jobs last month. Health care and construction were two of the sectors responsible for that growth, while the information sector lost jobs, according to the Bureau of Labor Statistics (BLS).
However, the unemployment rate rose for a fourth month in a row after previously having spent more than two years below the threshold of 4.0 percent, which was the longest such streak in more than 50 years.
While some experts suggested that Hurricane Beryl, which hit Texas last month, may have been partially responsible for the slowdown, BLS noted that it had “no discernible effect on the national employment and unemployment data.”
Politically, the jobs report is a mixed bag.
The economy has been surprisingly robust, and it has now added close to 16 million jobs since President Joe Biden took office.
While that is a figure Democrats will be touting in the weeks prior to the election, it must be noted that the economy is cyclical and there is only so much a president can do to create new jobs. In addition, Biden’s record benefitted from millions of Americans returning to work following the coronavirus pandemic that gripped the world before he took office.
Still, it is also true that job creation has been one of his administration’s strengths, and it is these figures that Democrats point to when they claim that “Bidenomics” works.
“In the past four years, Congressional Democrats and the Biden-Harris Administration have worked together to prioritize workers and their families and rebuild the economy from the bottom up and the middle out,” said Rep. Bobby Scott (VA), the ranking Democrat on the House Education and the Workforce Committee. “Today’s job report provides further evidence that these policies have paid off.”
Republicans put a different spin on the same numbers.
“Stagnant job growth and rising unemployment – these are the consequences of the Biden-Harris Administration’s economic policies,” said Rep. Kevin Hern (R-OK), the chairman of the conservative Republican Study Committee. “The harsh reality is that the Biden-Harris economy is failing American workers every day. Their policies just aren’t working – we need a new direction for our economy.”
Ultimately, the new BLS numbers will not allow either party to claim victory. In addition, we are now getting too close to the election for economic numbers to shift too much.
For example, while some experts worry that the higher unemployment rate is a harbinger of a looming recession, it won’t be known until next year whether the economy contracted in two consecutive quarters.
Furthermore, if the Federal Reserve cuts interest rates, which are currently at the highest levels in more than two decades, businesses would once again have access to “cheaper” money for investments in equipment and personnel.
However, the Federal Reserve this week declined to lower the rate in an effort to fight inflation, which will almost certainly be a bigger issue in the election than unemployment.
