The latest US jobs report is out and it’s not great.
It turns out that paying people not to work leads to a lot of them not wanting to work. Who would have thought.
Here’s the thing: the pandemic has crushed hundreds of thousands of small businesses and cooped people up at home, often without a reliable source of income.
Helping out unemployed folks with some benefits can be a necessary and noble goal.
But now that things are opening back up, more and more Americans just don’t really want to go back to work, especially to low-paid jobs where they get treated poorly and overworked for minimum wage.
You know things are bad when some McDonalds locations are offering people $50 just to sit for an interview.
What Does the New Jobs Report Say?
The new jobs report is bad news for Biden, listing only 266,000 jobs added in April and a rise in the unemployment rate to 6.1%.
The report from the Department of Labor was released on May 7 and shows that there are now 9.8 million unemployed individuals in the US, although the actual number is, of course, much higher.
Overall, the US economy has done quite well under Biden, adding 1.6 million jobs since January, in part boosted by massive stimulus spending.
But the April numbers are definitely a disappointment, with Dow Jones projecting 1 million new jobs and a 5.8% unemployment rate and other analysts expecting even better things.
The truth is there just aren’t enough available workers and people are hiding out and trying to figure out their life, not rushing to take crappy jobs that don’t pay much. But even good jobs are having trouble attracting people.
“I think this is just as much about a shortage in labor supply as it is about a shortage of labor demand. If you look at April, it appears that there were about 1.1 unemployed workers for every job opening. So there are a lot of jobs out there, there is just still not a lot of labor supply,” explained Harvard economist Jason Furman.
Carlos Gazitua who runs a restaurant chain in California says his business is struggling because people don’t want the jobs.
“We’ve increased wages. We have about three different staffing agencies that are constantly looking for people. Other restaurateurs are walking around neighborhoods passing out flyers. The heroes in our communities are the people currently working for you and me. These people are burnt out,” he said.
There are definitely some troubling times ahead, with billionaire Warren Buffet and others warning of a stock market bubble and serious inflation ahead.
CNN may get a lot wrong and have many liars on staff, but one of its great reporters who worked for years under Lou Dobbs is chief business correspondent Christine Romans.
She’s also been sounding the alarm on inflation, explaining that we’re headed for very expensive times here in America.
“You can expect higher prices for toilet paper, diapers, soft drinks, plane tickets, a tank full of gas,” Romans warned, adding as one benchmark example that “Whirlpool is raising prices of some of its appliances by up to 12 percent.”
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What’s Next as the Economy Opens?
Despite the disappointing job numbers, there are opportunities ahead for investors and certain sectors as the economy opens up.
In particular, people should take a look at energy and industrial stocks. The massive stimulus coming in from the Fed and the Treasury and people who’ve managed to save during the pandemic could actually create a future economic boom and stocks linked to the core of economic recovery in the energy sector, industrial, construction and manufacturing are a good idea to keep your eye on in the coming months.