The Council of Economic Advisors for the White House might think things are going great, but the numbers tell a different story. It’s sort of like the old Groucho Marx line, “Who are you going to believe, me or your own lyin’ eyes?”
With the pandemic still spreading and the federal unemployment bonus checks either cut or stalled, it looks like the economic recovery dropped into a lower gear this month.
Everything from small business employment to credit card spending and gasoline demand, things that typically grow during the summer months, went flat over the past couple of weeks at levels well below that of 2019.
Initial jobless claims dipped below 1 million for the first time in 21 weeks, but we still had 963,000 files, and more than 28 million filed continuing claims.
Ann Elizabeth Konkel, an economist with job site Indeed Hiring Lab, said:
“The recovery seems to be losing steam. It’s promising that initial unemployment claims have fallen, but there’s still a long road ahead.”
She noted that job postings rose for the 14th straight week, but at the smallest pace since early May.
The high savings rate we achieved because of stimulus payments and padded unemployment benefits might help families maintain spending for a while, but without another relief package, things could get ugly. Even if we do get a relief bill in Congress, they can’t bail people out forever. Eventually, we’ll have to deal with the economic pain.