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December 4, 2020

The Post-Election Jobs Freeze

November’s jobs report showed significantly slowing growth.

The good news is that the U.S. economy added 245,000 jobs in November, while the headline unemployment rate dropped a notch to 6.7%. The fuller measure of unemployment sits at 12%. The bad news is this represents a significant slowdown in job growth after the gangbusters reports following the reopening of the economy, and November’s report falls far short of predictions. All the ground we lost in March and April has not yet been made up — we’ve recovered only 12.3 million of the 22 million jobs lost.

The primary factor behind the slowdown is still COVID restrictions. Many states, counties, and cities are still imposing varying degrees of lockdown. Governors Gavin Newsom (California), Gretchen Whitmer (Michigan), and Andrew Cuomo (New York) have been legendary for their tyrannical regulations (not to mention gross hypocrisy), and such lockdowns in huge states make recovering jobs that much more difficult. Restaurants, for example, are often relegated to outdoor dining only and that’s not exactly a welcoming feature as temperatures plummet. (Where’s global warming when you need it?) Hence, fewer jobs are coming back. In fact, the areas of food service and retail actually lost jobs in November.

The elephant in the room, of course, is the presidential election. The November jobs report isn’t the first one since the election, but it is the first to include data from after it. Given the presumption that Joe Biden will take office in January, businesses began planning accordingly. Biden has already named much of his economic stagnation team, which bodes ill for the two recoveries President Donald Trump helped to fuel, even if the second remains incomplete.

Moreover, Biden and his team are likely to push for a major hike in the federal minimum wage — to $15 an hour. That sounds really great and “long overdue” as one leftist economist put it. But try telling the restauranteur who can only seat at 25% capacity outside that he has to pay his workers twice as much for a quarter of the work. The real world doesn’t work the way leftist pinheads with cushy jobs in think tanks seem to assume it does.

Between the way Democrat politicians have exploited the pandemic to wreck the economy and the Biden administration’s plans to kneecap business owners with tax and wage hikes and to tie them up with regulatory red tape, the American economy may be in for a tough winter. Biden’s “dark winter” comment might be right after all, if for different reasons.

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