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US adds just 194k jobs in September, falling far short of predicted 500k. Biden administration blames Delta variant

US adds just 194k jobs in September, falling far short of predicted 500k. Biden administration blames Delta variant
The US only added 194,000 jobs in September, far short of the expected half a million. While the stock market dipped and financial analysts fretted, the White House claimed things weren’t really so bad and blamed the coronavirus.

The September non-farm jobs report, made public on Friday, fell far short of the projected 500,000. It was also the second consecutive month in 2021 to do so, even after August’s initial disappointing numbers were revised from 235,000 to 366,000.

Overall unemployment fell to 4.8%, which is less than the expected 5.1%, but apparently only because more Americans dropped out of the labor force altogether. The available workforce declined by 183,000 last month, and was 3.1 million short of the pre-pandemic numbers recorded in February 2020.

While private payrolls increased by 317,000, government ones fell by 123,000, mainly in education. Most of the jobs were created in the service economy – led by the leisure and hospitality industry (74,000) – with manufacturing (26,000) and construction (22,000) bringing up the rear.

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“This is quite a deflating report,” Nick Bunker, economic research director at the job placement site Indeed, told CNBC. “This year has been one of false dawns for the labor market.”

Fox Business contributor Charles Payne argued the US was being transformed from a country that “used to love and appreciate work” to one that either refuses to work “or can’t because of forced mandates and restrictions,” referring to President Joe Biden’s push to mandate vaccinations.

The Biden administration offered three narratives in response. Labor Secretary Marty Walsh called the report “complex” and pointed out the “bright spots,” such as lower unemployment for women in general and black women in particular.

"This is not all doom and gloom here today,” Walsh told CNN on Friday. “Certainly, we know, I would love to be on this show saying we added three million jobs to the economy and now we can go on to something else, but unfortunately we're still... we're not there yet.”

Walsh blamed the Delta variant of the coronavirus for lower-than-expected jobs in the hospitality industry, “both as hiring and also in, in people going out to dinner using that.” 

White House Chief of Staff Ron Klein retweeted a New York Times analysis claiming that the “jobs [sic] numbers are pretty good actually.”

“The story of the economy in the second half of 2021 remains one of steady expansion that is more rapid than other recent recoveries,” wrote the Times’ Neil Irwin. “But the direction is clear, consistent and positive.”

However, even Irwin acknowledged that “Labor force participation remains the Achilles' heel of this recovery” and that many Americans who dropped out of the workforce for whatever reason haven’t come back.

Speaker of the House Nancy Pelosi (D-California), on the other hand, argued that the underwhelming jobs report merely provides further proof that Congress needs to pass the $3.5 billion Democrat spending plan, dubbed the ‘Build Back Better’ agenda.

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