The reality remains that there are still about five million fewer people in the labor force than when the pandemic turned our nation’s economy upside down in February of 2020.
By Richard Manning
More than 1.1 million more people were employed in November than October with gains of a little more than 3.5 million since July of 2021. Contrary to what one might assume, this dramatic increase in the number of people who have jobs is a direct repudiation of the Joe Biden, Nancy Pelosi, and Chuck Schumer unemployment policy.
It was June of 2021, when many GOP Governors announced that they would end the federal program that provided extra money for those who were unemployed in the face of record numbers of job left unfilled. Since then the employment market has taken off. And the second wave of this surge is directly related to the expiration of extra subsidization of unemployment for the rest of the nation.
Shocker of shockers, the old axiom that you raise taxes on actions you don’t want, and you lower them on actions you do, also applies to welfare spending. The Biden plan was to continue making it profitable to stay at home rather than to get a job, and guess what, that is exactly what Americans did, even as businesses were begging for workers.
The latest state unemployment data for October shows that twenty states currently have unemployment rates below 4 percent. Of these, every one of the top ten are run by Republican governors. Conversely, nine out of worse ten unemployment states are run by Democrat governors with Alaska being the outlier.
Before we get too giddy, the reality remains that there are still about five million fewer people in the labor force than when the pandemic turned our nation’s economy upside down in February of 2020.
Some of this can be attributed to retirements and other normal activity as baby boomers continue to hit retirement age, but the percentage of people in the working age population who are actively participating in the workforce remains surprisingly low. January of 2020 showed a participation rate of 63.4 percent, while this past month the rate reached was 61.8 percent with the lag about the same for both men and women.
However, it is reasonable to conclude that if the Biden administration and their congressional cohorts just leave the labor force alone, the participation rate will rise to its natural level given the country’s demographics.
Discerning readers might be surprised that this column/analysis does not follow the national headlines of a gigantic “miss” on the November numbers that became a talking point on Friday. Economic prognosticators predicted that the unemployment study which shows how many jobs have been created by employers would be significantly higher than the 210,000 registered in November.
The blame was placed on everything from resurgent COVID concerns to high cost of energy and inflationary concerns and all of those reasons could be true. However, what is also true is that America’s free enterprise system had created a near record 10 million job openings according to the most recent (September) JOLTs study. It is safe to say that America still has too many jobs chasing too few workers, and the higher wages which result may be the key to lifting the labor participation rate by attracting Americans currently sitting on the sidelines into the workforce. And that would be a good thing for everyone.
Let’s just hope that the Biden administration and Congress will stop the inflationary spending spree so that more and more Americans return to self-sufficiency, free from government dependency.
That was the promise of the Trump economy prior to the Chinese virus-induced pandemic. It was the course of our recovering economy through January 2021. But with Biden threatening more COVID restrictions and pushing another massive spending bill, it seems that promise of prosperity will be postponed for the foreseeable future.
Richard Manning is President of American of Americans for Limited Government.
