United States President-elect Joe Biden asked Congress to adopt a new aid plan after the release of a report showing that the unemployment rate fell to 6.7% in November, but the creation of new jobs has lost momentum. due to the advance of the pandemic.
The United States economy created 245,000 jobs in November, according to the Department of Labor, a number well below expectations.
And despite the fact that the unemployment rate fell from 6.9% to 6.7% in one month, the highest rate since the pandemic pulverized the labor market, there are still 10.7 million unemployed, to which are added people who have stopped to look for work.
Faced with this scenario, Biden, who takes office on January 20, warned of the need to act immediately.
“If we don’t act now, the future will be bleak. Americans need help now,” said the president-elect, who called on Congress to reach an agreement quickly.
The unemployment rate is eight points below the maximum reached during the pandemic in April, but it is still 3.2 percentage points above the level before the virus arrived.
“These improvements in the labor market reflect the continuous resumption of activity”, said the authorities, who qualified their message by pointing out that the pace of improvement “has moderated in recent months”.
Analysts had expected 650,000 jobs to be added to the market last month, but several economists had already warned that that number could be much lower due to indicators that hiring is declining due to the spread of the virus.
This scenario worries experts, as the virus advances uncontrollably in the United States, the country with the most deaths from the pandemic, which left 210,000 infections in one day on Thursday.
Another worrying fact is the number of long-term unemployed – who have been out of work for 27 or more weeks – and which in November increased by 385 thousand to a total of 3.9 million people.
As a result of the crisis, more and more people are leaving the job market. According to the report, the contribution rate fell to 61.5% of the working age population, which represents a drop of 1.9 percentage points in relation to the pre-crisis level.
This week, a bipartisan group of Democratic and Republican lawmakers presented a proposal for a new $ 900 billion stimulus package to support unemployed people who have exhausted their benefits and savings and many companies that are in danger of closing their doors.
Senate Republican chief Mitch McConnell entered the negotiation and indicated that he is willing to support a smaller plan, of about 500 billion, after the $ 2.7 trillion approved since the pandemic began in Congress.
Biden, who has been a senator for more than three decades, said that an emergency deal would be a kind of “entry” and that more help will be needed next year.
“If you insist on everything, you probably won’t get anything from both parties,” explained Biden.
McConnell indicated on Friday that he had a “good conversation” with House of Representatives leader Nancy Pelosi, with whom he must also negotiate a budget law that would prevent federal government paralysis.
“I think we are both interested in getting results,” added McConnell.
For the Oxford Economics consultancy, Friday’s data reflect a “cooling in hiring and a still very high number of new unemployed.”
There is consensus among economists about the need for a new economic stimulus plan.
Federal Reserve President Jerome Powell warned that “some difficult months” are coming.
Gregory Daco, from Oxford Economics, indicated that a new aid scheme for the unemployed and businesses would be a “lifeline” for the economy and warned that without such aid the situation could get worse.
“We fear that the coming months will be difficult for the economy, with risks of falling due to the imminent expiration of unemployment benefits for millions of Americans and an end to the moratorium on evictions,” he added.