Fourth Stimulus Check: How do the May unemployment numbers affect the chances of another payment?
The Bureau of Labor Statistics has released the May “Employment Report”, what do they numbers say about the possibility of a fourth stimulus check?
After a lackluster jobs report in April, many politicians, economists, and everyday Americans have been waiting to see what progress the labor market made in May. As the rate of those vaccinated increases across the US, more businesses are reopening, and more workers are looking to reenter the job market.
Additionally, many voters wonder what the most recent report means for the prospects of the government sending another round of stimulus checks. Law makers on Capitol Hill will now evaluate the May numbers within the larger economic recovery and determine if sending an additional direct payment could spur more growth. This is an especially important debate as new research shows that the stimulus checks helped keep American households above water throughout the pandemic.
According to the Bureau of Labor Statistics (BLS), unemployment in the United States fell a third of a percent to 5.8% in May. These figures show signs of economic growth, especially compared to the numbers from a year ago when the unemployment rate stood at 13.6% as businesses shuttered during the first wave of the pandemic.
The new national average of unemployed workers is also inching closer to the levels seen before the pandemic. In February 2020, about three percent of workers were out of a job, showing that while progress has been made, there are still gaps that remain to be filled. The Peterson Institute estimates that based on this rate of growth in the labor market, it could take the US two more years to reach the economic levels seen before the pandemic.
Sectors that saw the greatest increases were in "leisure and hospitality, in public and private education, and in health care and social assistance." However, Labor Secretary Walsh noted that while increases were seen in the hospitality sector, she reported that sector has not fully recovered and that the numbers should continue to improve.
On latest jobs numbers, Labor Secretary Walsh tells @PoppyHarlowCNN, "When you think about hospitality, the jobs that are opening in restaurants and hotels, they're not fully back yet. People are not fully back yet."— Kaitlan Collins (@kaitlancollins) June 4, 2021
What are lawmakers saying about the numbers? Will another stimulus check be sent?
Expectations over the may jobs numbers had grown in recent weeks, as the April jobs numbers were far lower than what had been projected.
In regards to messaging, Republicans have created a win-win situation for this jobs report because of actions taken on ending federal unemployment benefits. Many Republican governors called to end the additional benefits, citing labor shortages and the slow reentry of workers to the labor force. Many leaders claimed that generous federal benefits were keeping people at home, a common anti-welfare argument that has been made by Republicans for decades. However, many economists argue it is too early to tell if this hypothesis is accurate because the economy is still in early stages of recovery.
Additionally, many in the GOP are now able to say that that increase in job growth could be due to the calls to end additional benefits which they see as an incentive for unemployed workers to begin their job search. However, the motivations and rational for why more than half a million residents reentered the labor force cannot be extracted from the data. In the coming weeks and months, economist, and researchers will be able to demonstrate the impact these policies had on reentry, but for now, many believe it is too soon to tell.
Last month after the jobs report was released, President Biden has urged caution when trying to interpret the data. Biden warned that while the number of jobs added was lower than expected, the recovery is in its initial stages and that it may take months and even years to see the full benefits of the investments made. While the May figures fell short or the 650,000 that were expected, the gap is small compared to April.
In reflecting on new numbers from the BLS, the president told the press that although it was clear progress was being made, “it is not assured.” Biden continued by arguing that the numbers show that a major investment in infrastructure, like his proposal, the American Jobs Plan could help to secure a robust and vibrant economic future for the country.
Today’s jobs report shows historic progress for American families and the American economy. We added 559,000 jobs in May, created a record two million jobs in our first four months, and unemployment is at its lowest level since the pandemic started.— President Biden (@POTUS) June 4, 2021
America is on the move again.
The president also touted the economic recovery the US is making compared to other major nations saying “no other major economy in the world is growing as fast as ours. No other major economy is gaining jobs as quickly as ours. And none of this success is an accident.”
Will another stimulus check be sent?
Biden’s administration has made it clear that they believe Congress has the responsibility to decide whether or not another round of stimulus should be sent. The White House has taken a rather neutral position on the matter and has stated that it will follow the lead of lawmakers on Capitol Hill.
However, many House and Senate members believe if the President came out in support of the measure, or included it in one of his economic proposals, the chance of another checking passing would increase. Last month, seven members of the house Ways and Means Committee made this argument in a letter sent to the President. In the letter, the group urged the President to include an additional round of payments in his American Families Plan which focuses on building economic resiliency in low- and middle-income households.
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