Biden warns of Covid economic peril despite July job gains

WASHINGTON – President Joe Biden resisted the temptation to take a victory lap on Friday after good jobs figures were released in July, instead telling the country that the increase in Covid cases poses an urgent threat to economic recovery .

“My message today is not a celebratory message,” Biden said in a speech at the White House. “This is a reminder that we still have a lot of hard work to do, both to beat the delta variant and to continue advancing our economic recovery.”

The highly contagious delta strain of Covid currently accounts for at least 80% of new infections nationwide.

Still, hires increased last month at its fastest pace in nearly a year, despite fears about the delta variant and as companies grappled with tight labor supply.

The non-farm payroll increased by 943,000, while the unemployment rate fell to 5.4%, according to the department’s Bureau of Labor Statistics. The payroll increase is the best since August 2020.

The number of new jobs has exceeded economists’ expectations by nearly 100,000, and the unemployment rate has fallen three-tenths of a percent less than experts predicted.

In touting the strength and resilience of the economic recovery, Biden did something on Friday that he rarely does: he pointed the finger at Wall Street analysts to validate his point.

“What we are doing is working,” he said. “Don’t take my word for it. Wall Street forecasters predict that over the next 10 years our economy will grow by trillion dollars and create 2 million well-paying jobs.”

But the good numbers for July do not accurately reflect a disturbing new development in recent weeks: the increase in Covid infections and hospitalizations attributed to the delta variant.

This is because the actual figures for the monthly BLS job reports are calculated only during the second week of the month, based on that week’s data.

In the three weeks after the employment figures were calculated in July, hospital emergency rooms and intensive care units began to fill up again in parts of the country.

This prompted some large employers and schools to freeze plans to fully reopen offices and campuses in the coming weeks.

The White House is deeply concerned that the increase in the number of Covid cases could block economic recovery, jeopardizing Biden’s national agenda and the electoral chances of Democrats in the midterm elections.

And after months of relying on incentives, celebrity backing, and local outreach to persuade Americans to get vaccinated, the Biden administration took a tougher line last week, adding sticks to the proverbial equation. carrot stick.

Federal employees who cannot prove they have been vaccinated will be subject to a host of unpleasant work restrictions, such as being physically separated from their vaccinated colleagues.

The Pentagon has also announced its intention to include the Covid vaccine among the mandatory vaccines administered to the US military.

Biden did not address these measures in his speech on Friday, choosing instead to outline various measures the administration is adopting to protect the economic recovery.

He has repeatedly called Covid a ‘pandemic of the unvaccinated’, a phrase some critics say fails to capture the universal impact of rising cases and things like reinstating mask warrants .

As the White House often notes, more than 90% of Covid hospitalizations are people who have not been vaccinated against the virus. And while people who have been vaccinated can contract and transmit Covid, they usually have mild symptoms similar to a flu or sinus infection.

Both in public and in private, White House staff say the stubbornly high rate of unvaccinated Americans – 30% of eligible beneficiaries – creates a situation in which one virus, the coronavirus, essentially creates two health challenges. parallel and different public.

On one track are the 166 million fully or partially vaccinated people, whose government has not officially tracked individual Covid infections since March.

To them, the virus looks more like a seasonal flu from years past than the debilitating week-long lung attack millions of Americans experienced in 2020, before the vaccine was available.

But for the unvaccinated, many of whom are concentrated in the southeastern United States, the delta variant virus is just as deadly and far more contagious than the original virus was in the early months of the year. last.

Biden, however, thinks there is reason to be optimistic. “I am happy to report that last week we saw vaccinations for the first time in America increase by 4 million shots,” he said on Friday. “This is more than what we have seen in a long time.”

– CNBC’s Jeff Cox contributed to this report.