What’s behind disappointing job numbers?

“The 360” shows you diverse perspectives on the day’s top stories and debates.

What’s happening

The U.S. economy added 266,000 new jobs in April, according to the Bureau of Labor Statistics. While that figure shows the country is continuing to recover from the depths of the coronavirus recession, it falls well below the 1 million jobs that many forecasters had expected. That shortfall has raised concerns that the economy may not bounce back to its pre-COVID levels and instead may be primed for a slow, sluggish recovery.

The unemployment rate rose slightly to 6.1 percent last month. That represents a significant improvement from where it stood a year earlier, when it peaked at 14.8 percent. But unemployment remained relatively static through the first four months of this year, despite a rapidly growing share of Americans getting vaccinated and restrictions on businesses being lifted across the country. The economy is still short 8.2 million jobs from where it stood before the pandemic.

Economists had expected job growth to be much larger than it was because the gradual resumption of economic activity has led to a major spike in the number of job openings across the country. But employers say they’re having difficulty finding people to fill those positions, despite the nearly 10 million Americans who remain unemployed. In one survey of businesses in March, 42 percent of employers said they had open jobs they couldn’t fill.

Why there’s debate

So if there are millions of job openings and millions of Americans out of work, why is job growth so much slower than expected?

Conservatives and many business owners have pointed their fingers at enhanced unemployment benefits — an extra $300 a week — that were passed as part of the most recent stimulus bill. Critics say these benefits, while they may have been necessary last year when jobs were not available, are slowing the recovery by making it more profitable for many people to stay home than go back to work. Republican governors in three states have moved to slash the extra benefits, hoping to motivate residents to rejoin the workforce.

Democrats have defended the benefits by saying that the extra money is keeping many Americans afloat and that evidence it’s slowing job growth is limited to a few anecdotes from unhappy business owners. Many progressives have argued that businesses struggling to fill low-paying positions could raise the wages they’re offering to bring in more workers.

Beyond the political back-and-forth over unemployment benefits, experts in a variety of fields have offered explanations for slow job growth. There’s some evidence, for example, that fear of catching the virus is keeping potential workers from seeking jobs, especially among groups that have lower rates of vaccination — like young adults and people of color. Many parents may not be able to go back to work with schools and daycare centers still closed in parts of the country. It’s also possible, some argue, that the experience of the pandemic has made Americans less willing to accept poor working conditions and low wages. As one Arizona lawmaker put it, his state “does not have an employee shortage — it has a ‘workers willing to be exploited’ shortage.”

What’s next

All eyes will be on May’s jobs data, which will come out in early June, to determine whether April’s disappointing growth was a one-month hiccup or the start of a troubling trend.

President Biden is continuing his push for Congress to pass his massive infrastructure and family plans, which he argues will create millions of high-quality jobs that are needed to keep the recovery from stalling. Unless enhanced unemployment is renewed, the bonus benefits will end nationwide in September.


Unemployment benefits pay more than many jobs

“There’s another reason for the acute labor shortage: It pays to stay on the couch.” — Jillian Kay Melchior, Wall Street Journal

Low wages, not unemployment benefits, are keeping people from taking open jobs

“The extent to which people are holding off on going back to work because unemployment benefits pay better than the jobs that are available is unclear. That may be the case in some instances, and some businesses have discovered that they can quickly fill their openings by, you know, raising their wages (magic, right?).” — Jordan Weissmann, Slate

Unnecessary business restrictions are stifling growth

“Economic potential has been bottled up and held back for non-market reasons for more than a year. Given that, it should be fairly obvious that the removal of the restrictions and barriers that are currently holding back that potential will lead to very substantial economic expansion, once it happens.” — Matthew Gagnon, Bangor Daily News

The recovery will be slowed as long as the virus continues to spread

“The first-order issue is the virus, and if that’s what caused the crisis, then it is also the path out of the crisis. Crushing the virus is the solution to both the supply problem and the demand problem.” — Economist Aaron Sojourner to New York Times

Low vaccine rates among certain groups are hurting crucial industries

“The vaccination data are clear: Most people in the age groups likely to work in restaurants and similar businesses remain unvaccinated. … Since roughly a quarter of restaurant workers are historically younger than 35, a supermajority of the potential labor pool for restaurant workers remains unvaccinated. Other industries hit hard by the pandemic, such as hotels, also have much younger workforces than other sectors of the economy.” — Henry Olsen, Washington Post

Many Americans may not be willing to return to exploitative jobs

“The pandemic … has put all sorts of financial and emotional strains on Americans, and they’re re-evaluating everything, including their employment worth.” — Elvia Díaz, Arizona Republic

The long-term unemployed may have given up on looking for work

“Workers say they were discouraged after blasting out résumés in January and February. But those who have already given up, just before the latest hiring boom, may not have got the message yet about their improved chances.” — Ben Popken, NBC News

A shortage of workers to fill open jobs is still a positive sign for the economy

“It may seem odd to put a positive spin on a jobs report that fell short of expectations by a historic margin. But it certainly would’ve been worse if the shortfall was due to lack of employers seeking workers (demand) instead of employers struggling to fill open positions (supply).” — Sam Ro, Yahoo Finance

Job numbers are directly tied to the ongoing childcare crisis

“It’s pretty clear that women will make or break this economic recovery and mothers are going to be at the center of it. Will mothers work? ... It is an economic question that has probably never been larger than it is right now.” — Economist Kathryn Anne Edwards to Reuters

The pandemic has been too disruptive for the economy to bounce back right away

“The job market also isn’t just snapping back to what it was before Covid-19. The dislocations across different industries and worker demographics [have] been too big to recover from while Covid-19 continues to infect tens of thousands of people every day.” — Anneken Tappe, CNN

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Photo illustration: Yahoo News; photos: Getty Images