July jobs report suggests Biden is right about a recession


The jobs report is good news for President Biden, who has insisted in recent weeks that the United States is not in recession, even though it has suffered two straight quarters of economic contraction.

But the report also challenged even the president’s own optimistic expectations about the state of the labor market β€” and appeared to contradict the administration’s theory of where the economy is headed.

Mr. Biden celebrated the report on Friday morning. “Today, the unemployment rate is at its lowest in more than 50 years: 3.5%,” he said in a statement. “More people are working than at any time in American history.”

He added: ‘There is still work to be done, but today’s jobs report shows that we are making significant progress for working families.’

The president has said for months that he expects job creation to slow soon, along with wage and price growth, as the economy shifts to a more stable state of slower growth and lower inflation.

“If average monthly job creation moves next year from current levels of 500,000 to something closer to 150,000,” Biden wrote in an op-ed for The Wall Street Journal in May, β€œIt will be a sign that we are successfully moving into the next phase of recovery – because this kind of job growth is compatible with low unemployment and a healthy economy.

White House officials prepared reporters this week for the possibility of job growth slowing, in line with Mr. Biden’s expectations. The number of job creations that exceeded expectations seemed to surprise them, once again.

But Mr Biden will almost certainly cite the numbers as evidence that the economy is far from in recession. He and his aides have repeatedly said in recent weeks that the current pace of job creation is out of step with job numbers from previous recessions, and evidence that a contraction in gross domestic product does not mean that the country is mired in a recession.