(Ben Sellers, Headline USA) The Biden administration and leftist media once again tried to gaslight the American public with deceptive claims of a robust economy after the December jobs report showed that the government continued to grow and more people, overburdened by inflation, took second jobs working in the food-service industry.
Meanwhile, hospitals continued to recover from the massive wave of job losses they experienced during the first few months of the COVID-19 pandemic due to the combination of media-driven panic, an influx of new patients who overwhelmed front-line healthcare workers and the additional burdens imposed by the highly contagious novel coronavirus.
Outside of those three fields, the economy continued to look anemic, with warning signs that other sectors likely faced the prospects of a recession—or may already be in one that was being artificially buoyed by the additional government jobs and an influx of low-wage migrant workers via President Joe Biden’s open-border policies.
The staggering milestone earlier this week that the national debt had hit $34 trillion for the first time was of particular concern. In a matter of only three months, the Biden administration managed to accrue more debt than the U.S. government had in its entirety in the year 1981, when it first reached the $1 trillion mark.
It's official: US National Debt hits $34 trillion for the first time, over $12 trillion higher than where it stood just 5 years ago (55% increase). pic.twitter.com/0NIMrDZkJm
— Charlie Bilello (@charliebilello) January 3, 2024
In response to consumers’ more selective buying habits in the inflationary economy, stores also were continuing to limit their inventory—a sign that growth in the retail sector may remain stagnant in the foreseeable future.
Once again, it was also likely that the December estimate painted an overly rosy picture that would later be revised downward after the initial reporting on a robust economy had already given the Biden administration its talking points.
Except this inconvenient chart that destroys your lying narrative pic.twitter.com/QuFpjZRTvZ
— Gimme3Steps (@TheSouthGAJohn) January 5, 2024
Paul Ashworth, chief North America economist at Capital Economics, noted that the government revised down its previous estimate of job gains for October and November by a combined 71,000.
And just as in November, December’s job growth was concentrated in just a few industries: Leisure and hospitality companies added 40,000, healthcare 38,000 and governments 52,000.
Indeed, from October through December, private-sector employers have added just 115,000 jobs a month, the lowest three-month average since companies were laying off workers in mid-2020 during COVID-19 lockdowns.
In addition, the proportion of people who either have a job or are looking for one fell in December to 62.5%, the lowest level since February.
The Fed prefers having more people in the labor force to help ease pressure on employers to sharply boost pay to attract or retain workers. Companies typically pass their higher labor costs on to consumers by raising prices.
In December, the number of Americans in the labor force actually fell by 676,000, the sharpest such drop since January 2021.
Fed Chair Jerome Powell had warned of hard times ahead after the central bank began jacking up interest rates in the spring of 2022 to attack high inflation. Most economists predicted that the much higher borrowing costs that resulted would cause a recession, with layoffs and rising unemployment, in 2023.
Since March 2022, the Fed has raised its benchmark interest rate 11 times, lifting it to a 22-year high of about 5.4%. Those higher rates have made borrowing costlier for companies and households.
Nonetheless, the Biden administration’s profligate spending to create the mirage of a robust, recession-proof economy has counteracted the Fed’s measures and turned the hard landing into a long, drawn-out skid.
Prices are still 17% higher than they were before the inflation surge began and are still rising.
In a poll conducted in November by the Associated Press–NORC Center for Public Affairs Research, about three-quarters of respondents described the economy as poor. Two-thirds said their expenses had risen.
Consumer prices were up 3.1% in November from a year earlier, down drastically from a four-decade high 9.1% in June 2022. The Fed has been satisfied enough with the progress so far that it hasn’t raised rates since July and has signaled that it expects to make three rate cuts this year.
Still, Friday’s robust jobs and wage figures could lead the Fed to push back the start of any interest rate cuts if it decides that inflation will take longer to tame.
“Today’s report speaks to the bumpy road ahead for the Fed’s journey back to 2% inflation,” said Andrew Patterson, senior international economist at Vanguard.
Patterson suggested that the Fed might have to wait for the second half of the year to start cutting rates, longer than many investors had expected.
Those fear, in turn, sent the stock market into a tailspin on Friday.
In the meantime, many employers are still finding it hard to fill jobs. They include Isidore Kharasch, who runs Hospitality Works, which provides consulting services to restaurants, bars and hotels.
Kharasch said his restaurant clients are finding it easier to find servers than they did a year ago. But hiring culinary workers, including chefs and front line cooks remains difficult.
Many such workers didn’t like their hours and have taken other types of jobs. That trend, Kharasch said, has forced some restaurants to simplify menus or reduce their selection.
“It’s constantly adjusting the menu to fit where our staff is at any one time,” he said.
Kharasch said he thinks the minimum wage increases that are taking effect this year in some states will result in more automation, increased prices and a reduction in hours of operation to save money.
Beginning April 1, California will require fast food companies to pay their workers at least $20 an hour.
Already, Pizza Hut has announced the layoff of 1,200 delivery drivers as a result.
Krystle Phillips, owner of Roll Ice Cream LLC in St. Petersburg, Florida, which sells rolled ice cream machines, ingredients and supplies to ice cream trucks and stores, is struggling to find workers willing to work full time. Job candidates are demanding higher pay.
Short of help, Phillips, who considers herself an expert in refrigeration and logistics, has had to get up to speed on writing recipes and accounting.
“It’s been hard to hire these specialized positions,’’ she said.
The Associated Press contributed to this report.
Ben Sellers is the editor of Headline USA. Follow him at twitter.com/realbensellers.
