The May jobs and unemployment report has been released and shows a strong economy under the Biden Administration. The report highlights some of the best results seen in half a century, with 272,000 jobs created in May and unemployment at 4%, the lowest in 50 years. The White House celebrated these numbers as a sign of a robust and durable track record on jobs and unemployment.
Job growth was seen in sectors such as health care, leisure, and hospitality, and professional services, with wages continuing to rise. Although there are concerns about the impact of higher wages on inflation, experts note that the rate of increase in wages is slowing. The Economic Policy Institute (EPI) has also documented significant real wage growth for low-wage workers between 2019 and 2023. However, raising the federal minimum wage, which has remained stagnant at $7.25 per hour since 2009, could further benefit low-wage workers.
Despite these positive trends, there are some concerns in the jobs report, particularly regarding Black unemployment, which ticked up to 6%. Historically, Black employment lags behind that of whites, and economists emphasize the importance of maintaining full employment to support historically disadvantaged groups. While the Biden Administration has taken steps to address racial gaps in employment, economist Darrick Hamilton believes that more structural policies like a federal job guarantee are needed to completely close these gaps.
Many economists had predicted a recession by now, but Biden’s economic policies have helped sustain overall growth and benefit lower-wage workers and economically troubled regions of the country. Although some slowdown in job and wage growth may be expected in the future, there is optimism that intelligent policy choices can help avoid downturns. Economists like James K. Galbraith argue that economic outcomes are driven by policy choices, and Biden’s focus on inclusive growth seems to be yielding positive results based on the latest jobs and employment numbers.
