An economics expert has burst President Joe Biden’s narrative that he is responsible for creating record job growth.
What has Biden claimed?
Throughout his presidency, Biden has repeatedly claimed that his administration has created more jobs than any previous administration.
Just last week, Biden said he is responsible for creating 6.4 million jobs in 2021, attributing the alleged success to the American Rescue Plan, the Biden COVID-stimulus package that some economists claim has worsened inflation.
“We added 6.4 million jobs last year. That’s the most jobs in any calendar year by any president in history,” Biden said. “How? The American Rescue Plan got the economy off its back and humming again — and 200 million vaccinations got Americans out of their homes and back to work.”
But what is the truth?
While it is true the economy added 6.4 million jobs last year, the Biden administration is deceitfully framing their alleged accomplishment by obscuring the fact that the vast majority of those jobs are not new. Rather, the majority of those jobs were Americans returning to the workforce after the worst of the COVID-related lockdowns ended.
ADP chief economist Nela Richardson made that exact point during a CNBC interview on Wednesday.
In fact, Richardson explained that Biden is not responsible for adding “one single job” from the “high-water mark” under then-President Donald Trump in 2019 before the COVID pandemic.
“The economy — and this is an important point — hasn’t added one single job from the 2019 high-water mark. Not one,” Richardson declared.
“All the jobs that we have seen gained are recovered jobs that were lost. We’re not yet producing new jobs,” Richardson explained. “In fact, we’re still about nearly 4 million jobs short. So, these wage gains are coming on top of a shrinking workforce, and it’s not being fueled by productivity enhancements.”
Data from the Bureau of Labor Statistics confirm Richardson’s point. According to the latest report, the economy remains 3.6 million jobs short of pre-pandemic levels in February 2020, which means the economy remains at a net-loss on jobs.
Regarding wage gains, Richardson explained those, too, are not true gains, but are being driven by labor shortages. And even those gains are being destroyed by high inflation.
“I think that wages are going to be a false metric,” Richardson said. “It’s not driving inflation, and wages are trying to keep up with an economy that is now feeling the effects of all kinds of different shortages from different angles.”