President Joe Biden said the US has the strongest economy in the world, seizing on a report showing payrolls rose by more than forecast in August even as wage growth cools and the economy faces other headwinds.
“America’s now in the strongest job-creating period in our history,” Biden said from the White House Rose Garden, seeking a political boost after months of struggling to sell voters on his stewardship of the economy and drawing a contrast with his predecessor and likely 2024 challenger, Republican front-runner Donald Trump.
US has added 13.5 million new jobs – Joe Biden
“We’ve added 13.5 million jobs since I took office. Around 800,000 of them manufacturing jobs. We’ve created more jobs in two years than any president created in a four-year term,” said Biden. “My predecessor is one of only two presidents in history who entered his presidency and left with fewer jobs than when he entered.”
Friday’s job report, though, offered a mixed package, showing US hiring ticking up but wage growth slowing and a higher unemployment rate. The White House event was the latest bid from Biden to tout his economic agenda, dubbed Bidenomics, ahead of next year’s election, with polls showing voters give his handling of the economy poor marks.
Biden has travelled the US in the past few months to highlight the impact of his policies on local communities but that pitch has largely fallen flat with voters still worried about lingering inflation and the threat of a softening jobs market. Biden on Friday said inflation over the past three months is closer to where it was before the COVID-19 pandemic and that incomes were higher.
August data showed US hiring picking up, with the number of non-farm jobs rising by 187,000 and topping forecasts. The figure includes a drop of 54,000 in the film and trucking industries, with the Hollywood writers’ strike and the bankruptcy of Yellow Corp, weighing on those numbers.
Taken at face value, the US August #jobs report increases the probability that the highly data-dependent Fed will not hike again in this cycle as
Job gains (including revisions) moderated (187,000 and -110,000);
The unemployment rate went up to 3.8%;
Labor force…— Mohamed A. El-Erian (@elerianm) September 1, 2023
The labour market has raised hopes the nation may avert a recession at least in the near term. Hiring and incomes have been firm enough to bolster consumer spending. Still, Friday’s report offered fresh signs that hiring has not been as strong as previously reported. June and July payroll gains were revised lower by 110,000, following data last week.
Unemployment rose to 3.8 per cent, reflecting growing labour market participation. That in turn could help soften wage pressures. Average hourly earnings were up 0.2 per cent from July, the smallest increase since early last year, and up 4.3 per cent from a year earlier.
Friday’s data is the last jobs report the Federal Reserve will see before its policy meeting this month. Policymakers are expected to keep rates steady but chairman Jerome Powell has signalled interest rates could rise further should the economy and inflation fail to cool.
The economy remains a vulnerability for Biden in polls despite positive economic data in recent months, as recent data on a manufacturing boom, job gains, strong gross domestic product growth and easing inflation fail to resonate with voters.
At last week’s first Republican presidential debate, candidates on the stage lambasted Biden’s policies on the economy and vowed to undo them if elected.
GDNow model from Atlanta Fed (a nowcast, not a forecast) unchanged today at +5.6% (q/q ann.) for 3Q2023 … consumption remains a hefty driver given +2.9% contribution to overall rate pic.twitter.com/CoO4xFPHzt
— Liz Ann Sonders (@LizAnnSonders) September 1, 2023
