Heather Cox Richardson
New figures out today from the Labor Department show that employers added 187,000 jobs in August, up but at a slower rate than the red-hot job market has been adding since the pandemic. Unemployment ticked up to 3.8%, in part because of the 37,000 jobs lost when the trucking company Yellow declared bankruptcy. The economy appears to be steadying, with only 1.5 jobs for every person looking, down from the 2 openings in early 2022.
As the hiring frenzies of the past two years calm down, economists expect job growth to continue in health care and education, which have made up 85% of the job growth in the past three months. After that, government investments in infrastructure under the Bipartisan Infrastructure Act, renewable energy thanks to the Inflation Reduction Act, and semiconductor manufacturing thanks to the CHIPS and Science Act are likely to keep demand growing.
The economic numbers for the Biden administration are remarkable and demonstrate the strength of the system under which the government operated from 1933 to 1981: the idea that investing in ordinary Americans builds the economy far more efficiently than so-called “supply-side economics.” That economic ideology, advanced by the Reagan Republicans, claimed that cutting regulations and concentrating wealth at the top of the economy would enable business leaders to invest in the economy efficiently, cutting costs and driving economic growth.
But that vision has never produced as promised, while it has dramatically concentrated wealth and power since it went into effect in 1981. “Bidenomics” is a rejection of that theory and a return to the economic vision that built the country in the fifty years before it. Investing in infrastructure and programs that help ordinary Americans puts money and the power of innovation into their hands, driving the economy from the bottom up and the middle out, as Biden puts it.
In a reflection of the plan to use the government to help those at the bottom of the economy, the administration yesterday canceled $72 million in student loans for 2,300 borrowers who were cheated by the for-profit Ashford College, which was purchased in 2020 by the University of Arizona. It says it will try to recoup the money from the University of Arizona, which denies any responsibility for the actions of Ashford or its parent company, the education technology services company Zovio.