A controversy is mounting in the United States: the country would be struck by the French disease because of the unemployment benefits set up by Joe Biden. It all started with figures published Friday, May 7: only 266,000 jobs were created in April in America, while nearly a million were expected. And above all, when millions of companies complain of not being able to recruit.
All that was needed was for the opposition, the Republicans, the employers’ organizations and also several federated states not to cry haro on the exceptional unemployment benefit which has just been extended by the new president. These $ 300 per week, that’s 1,200 euros per month which is added to the check for just over 1,000 euros received by each household. The Wall Street Journal, a conservative business newspaper, summed up the criticisms in a vengeful editorial by saying, “You know what? When you pay people not to work, well, that’s exactly what they do.”
Critics believe Biden is turning the United States into a European socialist country
Does that mean that Americans would no longer bother looking for work? In fact, that’s what critics say who believe Biden is turning the United States into a European socialist country. In short, France, with its persistent unemployment, whatever the economic weather. The US unemployment rate rose last month to 6.1%.
Suddenly, in North Carolina, Florida, we reinstated the job search controls for the beneficiaries of this exceptional unemployment, controls which had been suspended during confinement. In Montana, the $ 300 aid payment was cut off altogether. And then we set up a $ 1,200 bonus for anyone returning to work.
Are these criticisms justified? It would be a bit of a rush to follow them. First of all, it’s true that the monthly figures are volatile. A single indicator is not always significant, on the rise as well as on the downside. Besides, as always, it’s the trend that counts. We will therefore know more next month. Second, it is likely that indeed many parents, women in particular, did not return to the labor market despite the offers. Not because he receives an allowance, but because the schools have not all reopened and where they are stuck at home to keep their children.
The very strong recovery underway is hampered by a shortage of resources
But does that mean that employment will pick up when the Covid crisis is behind us? Look, hopefully, but this case reveals a bigger problem that affects most countries. The very strong recovery underway, supported by massive public spending programs, is hampered by a shortage of resources: physical resources (with shortages of raw materials, metals, for example, semiconductor components) but also, and this is new, human resource shortages.
There are 8 million fewer Americans working compared to February 2020, as growth has picked up again. Suddenly, employers are offering higher wages. The average U.S. hourly wage rose 8.4% last month compared to the previous year. It’s enormous. But there are also peaks of over 16.8 percent in trade over one year and more, 19.2% in tourism, in the hotel industry. Not that easy to manage the recovery.
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