The American economy added 531,000 jobs in October, according to the U.S. Labor Department. CEI experts pointed to Covid declines but also warned that emerging government policies pose a real threat to future gains – President Biden’s newly unveiled vaccine mandate for workers and looming deficit spending.
Statement by Ryan Young, CEI senior fellow:
“October’s jobs report looked good because COVID’s delta variant eased. November’s report will also likely depend on COVID’s severity. While there is little that can be done to stop a new variant from evolving, the approval of vaccination for children is good news, as is the pending approval of a COVID pill, assuming the FDA doesn’t drown it in bureaucracy.
“What would undermine upcoming jobs reports is more deficit spending, which is money that must be taken away from somewhere else before it can be spent. Congress should stand down on its nearly $3 trillion of mostly COVID-unrelated deficit spending in its infrastructure and reconciliation bills. It should instead focus on unclogging supply networks and lifting barriers against job creation. This would involve getting rid of trade barriers, occupational licenses, and other never-needed regulations.”
Statement by Sean Higgins, CEI research fellow:
“Friday’s Labor Department report that the U.S. economy gained 531,000 jobs in October, beating earlier expectations, again shows the economy will recover on its own given the chance. But the Biden administration’s new vaccine mandate could threaten these gains.
“The largest single factor in the jobs gain appears to be the continuing retreat of the Covid-19 outbreak, as new cases fell 57 percent since the beginning of March. The department reported that 3.8 million people were not able to work in the last month due to the pandemic, a decline of 1.2 million from September. The leisure and hospitality industry, one of the sectors most sensitive to the pandemic, added 164,000 jobs in the last month.
“Another factor in the October gains was, ironically, the supply chain crisis. The department reported that the transportation and warehousing sector hired 54,000 people in October. Overall, that sector now employs 149,000 more people than it did in February 2020, when the pandemic first forced the economy into lockdown. Retailers, suppliers, ports, and the transportation industry are responding to crisis by upping hiring, addressing the labor shortage that helped to create the crisis in the first place.
“The economy is still vulnerable, however. The number of people forced to part-time or workforce drop out remained entirely unchanged from the previous month. The current unemployment rate of 4.6 percent is still more than a point above its pre-pandemic low of 3.5 percent, and the economy has yet to regain 1.7 million jobs that were lost due to the virus outbreak. This is exactly the wrong time to force a new vaccine mandate on businesses requiring them to fire employees who refuse to get vaccinated or tested regularly. This policy will almost certainly cause the employment gains to slow and possibly even reverse. The Biden administration should reconsider and withdraw the mandate.”