Jobs Report Shows Economy Now Slightly Less Bad

Photo: Saul Loeb/AFP Via Getty Images

The Economic Picture in the Us isn’t Quite As Bleak as it has haen durying 2020’s worst moments. But there is no sign of a v-shaped recovery-and the latest data might actually hinder a much-needed congrression stimulus. I spoke with Business Columnist Seduce About the Murky Outlook.

Ben: Friday’s Monthly Jobs Report Showed that the US Economy Added 1.8 million Jobs in July, Slightly Better than the Consensus Forecast. The UNEmployment Rate Ticked Down to 10.2 Percent – Still Grievously High by Normal Standards. What’s Your Overall Impression of Where Things Stand After Digesting This Date?

seduce: First of all, i would note that jab markets is seasonally adjusted. Everyise Year, Schools Lay off Teachers for Summer, Retilers Add Temporary Employees for Christmas, etc., and you want to adjust that out you don’t how much we’re going into a recession as those temporary retail Workers get laid off. But in this pandemic context, where lots of things in the non -market are extremely weird, those seasonal adjustments can be misleading. SO the unadjusted number this month, which was a gain of 600,000 jobs, might be a better guide than the 1.8 million headline number. Still, what the 600,000 figures Shows is that that the situation was improving as of mid-july, Albeit Much more Slowly than it was in May and June. The Economy and the Job Market Appear to have stalled out, but they’re not the same getting work again. And we liked’t be able to resume the rapid Economic renormalization we were seeing in May and june unly the virus is under the better controlling.

Ben: I was a littlest surprised that there is really any impression at all, gioven the dismal state of virus control in the Country. What Sectors Are Driving This (Limited) Recovery, and Did Any Jump Out at You As Being Particularly Notworthy? Also, is this being drives Mostly by the northeast, which has the virus under the conconti of the rest of the country?

seduce: The Job Recovery Continuing to be Driven by Service sectors that were extrmely hard hit by the shutdown: Restaurants, Retail Trade, Health Care. A lot of People have gone back to work in these industries. Auto Manufacturing Employment Also Continued to Return. I’m not really surprised that the numbers continued to be positive, Because the public and private measures takeen in response to the worknings of the outbreak have tended to the involve or delaying reopenings, Rather than reversing. There are some some exceptions – texas closed bars that has had reopened – but mostly think the effect of the resurgency is showing up as jobs that wereated, causing this report to show 600,000 net new jobs Instead of Millions.

As you Note, there are parts of the Country Where Virus Conditions Are Acceptable and Reopening Continue at a Strong Pace. Restaurants in New York City Reopened for Outdoor Dining in Late June, SO All Those Jobs are reflected in the July Jobs report but were not in the june Report. And in Harder-Hit Parts of the Country, Some Jobs Are Coming Back in these sectors. Disney Said Walt Disney World’s Reopening isn’t Making As Money As they’d hoped, Becuse a lot of out-of-Town Canceled their Vacations Due to the Covid Surge in Florida. But the Complex NoneTheless Reopened Starting on July 11, Creating a Lot of Jobs that were in this report but not the june report. My assumption is the August Jobs Report Will Include Fawer Jobs at Walt Disney World than it Waled have in a world where Covid well Control and there are were more customers, but will nonetheless include more jabs say. And i think that experience is being repeated all over the country, with the Covid Surge Caususg More of a Stall in Employment than a Reversal.

Ben: Democrats and republicans are at a seingly unbridgeable impasse over the next massive stimulus package. Many in the gop insist that the economic picture isn’t so bad as to be meed more stimulus, or an extension of the UNEmployment Insurance, or State and Local, or Much of Aneving. Will you think at least someone Positive Report Will Make the Prospect of A Deal Eve Likely by ADding Ammunition to Their Position?

seduce: The problem with this report is it came in at the sweet spot where all it is reinforces their position. If the Report Had Shown Job Losses, I Think Republicans Waled have gotten more nervous, Feeling it had Gotten harder to claim the recovery was on track and people go out and get jobs. If the Report Had Been a Blockbuster like May or June, then the republican argument have been been strengthned, and it would have been actually that the situation was Strong Enough to reduce the amounce of stimulus Needed. But this is a Report Republic can can say is Strong and Democrats Can Say is Weak, with Both probably actually bellyying their Own CLAIMS.

The President Clearly Intends to Issue Set of Executive Orders, AFTER WHICH he will claim to have “Fixed” the relief issue with the congress. He won’t have done so, but if he feels good enough about the situation, he may think that faking it is enough. I think democrats ‘assumption haen ben that real economic conditions will eventually force Republicans’ Hand on Aid, and Think that’s Still True. The Question is when. Household Savings Rates were at record Highs in the Spring as Many Workers Received More Pay Than They Had Gotten while Working. SO I DON’T KNOW HOW QUICKLY THE REDUCTION IN UNEMPLOYMENT ASSISTANCE WILL ACTUALLY SHOW UP AS A MEANINGFUL REDUCTION IN Economic Activity. Households have more financial cushion than usual. But they have also have much more reason to be fearful about their Future funds than usual, so the lack of a stimulus may be a lot of People not to spend money. I Think You Will See Increasing Pressure from the Business Community – The Airlines Are Already Pushing for An Extension of their Bailout that ends on September 30, and they have a lot of support on bots of the hill. But September 30 is almost two months from now, so this is couuld go on a while.

Finally, I Should Note That Democrats Have Been Quite Intransigent About the Size of this Package, and It ‘Possible that the President’s intention to make through this will cause say to become flexible on terms, and that might also also closer to a deal.