Data will show a job market that needs to be rescued
The monthly jobs report usually is a prism for investors to play a guessing game over the Federal Reserve. But the Fed has taken itself out of play with its pledge to keep its target interest rate at zero for a good long time.
There’s still plenty of opportunity for the September job numbers to move markets in the week ahead.
The unemployment rate has fallen sharply from its April pandemic high. Yet, less than half the number of jobs cut by U.S. companies in March and April have been brought back. Millions of people remain unemployed, and millions more still are underemployed. More than 800,000 people have filed for first-time unemployment benefits each week over the past month. Six months into the pandemic, and more people are filing unemployment insurance for the first time than what the economy saw during the worst of the Great Recession.
This is not a job market in recovery. It is a job market that needs to be rescued.
When the September data is released on Friday, it likely will add pressure on Congress to compromise on another stimulus plan. Investors are growing impatient. Just look at the September stock selloff. And that has come even as the Federal Reserve took the historic step of committing to low interest rates even when inflation may pick up.
Fed Chairman Jerome Powell has taken to his bully pulpit in recent weeks to diplomatically push House Democrats, Senate Republicans and President Donald Trump for more stimulus spending. With the Senate’s attention now consumed by a Supreme Court seat battle, it’s investors and the economy that risk being pushed around.
Tom Hudson hosts “The Sunshine Economy” on WLRN-FM, where he is the vice president of news. Twitter: @HudsonsView.
