On The Money: Key takeaways from May jobs report | Biden rejects new GOP infrastructure offer as talks drag on
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THE BIG DEAL: Key takeaways from May jobs report: Politicians, economists and lawmakers are all pouring over the May jobs report that showed the U.S. added jobs as the unemployment rate fell.
Specifically, the economy gained 559,000 new workers and the jobless rate dropped to a pandemic-low of 5.9 percent.
Economists often caution that the monthly jobs report is just a snapshot of the labor market, particularly given the unique ways COVID-19 has damaged and shaped the economy, but May’s numbers still provide important insights into how the U.S. is recovering from the pandemic.
Here are five key takeaways from Friday’s Labor Department report.
- Hard-hit sectors continue their strong recovery: May brought more sorely needed jobs to industries derailed by the COVID-19 pandemic that are beginning to recover as the virus comes under control in the U.S. The leisure and hospitality sectors gained 292,000 jobs, with 186,000 workers added to payrolls at restaurants and bars. The U.S. also added 53,000 jobs in local public schools, 50,000 in state schools, and 41,000 in private schools.
- Hard-hit demographics are still lagging: Some of the industries hindered the most by COVID-19 are rebounding, but many of the demographic groups who’ve suffered disproportionate burdens continue to trail the rest of their peers. The Black unemployment rate was 9.1 percent in May, well above the 5.1 percent unemployment rate for whites and 5.5 percent for Asian Americans. The Hispanic unemployment rate also remained high, at 7.3 percent.
- Labor force participation is stubbornly frozen: The percentage of working-age adults who are employed or actively seeking jobs was largely unchanged at 61.6 percent in May, sitting 1.7 percentage points below its February 2020 level.
- Wages are rising — but from pandemic depths: Average hourly earnings rose 0.5 percent in May, with wage growth hitting a 2 percent rate after falling sharply during the onset of the pandemic.
- Political battle over the recovery will rage on: The solid but unspectacular report has given both Democrats and Republicans ample ammunition to claim that their approach to the economy is better than the other’s.
I break it all down here.
LEADING THE DAY
Biden rejects new GOP offer as talks drag on: President BidenJoe BidenFauci, Jill Biden visit New York vaccine site More than 100 former world leaders call on G7 countries to to pay for global COVID-19 vaccination Ukraine’s president implores Biden to meet him before summit with Putin MORE and Sen. Shelley Moore CapitoShelley Wellons Moore CapitoDivisions remain on infrastructure as clock ticks on bipartisan deal Buttigieg: ‘Still lots of daylight’ between GOP, White House on infrastructure Manchin says he is ‘very confident’ there will be compromise on infrastructure MORE (W.Va.), the lead Republican negotiator on infrastructure, spoke by phone on Friday but didn’t announce any significant development or breakthrough in talks that have stretched past the initial deadline of Memorial Day. Instead, Biden and Capito have plans to speak again on Monday.
White House press secretary Jen PsakiJen PsakiWhite House briefing room to return to full capacity Divisions remain on infrastructure as clock ticks on bipartisan deal Buttigieg: ‘Still lots of daylight’ between GOP, White House on infrastructure MORE said in a statement that Capito upped the GOP counterproposal to Biden’s American Jobs Plan by $50 billion, which wasn’t nearly enough for the president.
“The President expressed his gratitude for her effort and goodwill, but also indicated that the current offer did not meet his objectives to grow the economy, tackle the climate crisis, and create new jobs,” she said.
The impact: The lack of any reported progress is likely to further fuel mounting frustration among some Democratic lawmakers who have dismissed the latest Republican infrastructure offers as not serious.
The context: Capito, the lead GOP negotiator, and Biden missed an informal Memorial Day deadline to clinch a deal. Democratic lawmakers, who start returning to Washington next week, are now eager to move forward on an infrastructure package, with or without Republicans.
The Hill’s Morgan Chalfant explains why that might not be enough.
G-7 close to deal for global minimum tax rate of at least 15 percent: report: The Group of Seven (G-7) finance ministers are nearing an agreement to push in international tax negotiations for a global minimum tax of at least 15 percent, Bloomberg reported Friday, citing people familiar with the issue.
The Hill’s Naomi Jagoda has more here.
ON TAP NEXT WEEK
- The Urban-Brookings Tax Policy Center hosts a webinar entitled “What Are the Effects of the Biden Administration’s Corporate Tax Proposals?” at 9:30 a.m.
- Acting Office of Management and Budget Director Shalanda Young testifies before the House Budget Committee on President Biden’s fiscal 2022 budget proposal at 11 a.m.
- The House Financial Services Committee holds a hearing entitled “Universal Vouchers: Ending Homelessness and Expanding Economic Opportunity in America” at 12 p.m.
- A Senate Banking subcommittee holds a hearing on central bank digital currency at 2:30 p.m.
- The Joint Economic Committee holds a hearing on the gender wage gap at 2:30 p.m.