ICYMI: WSJ and CNN: President Biden's Resilient Economy Defies Expectations

Last week's jobs report showed that the economy created 339,000 jobs last month, totaling more than 13 million created since President Biden took office — defying expectations.

"This economy is incredibly resilient, despite all the slings and arrows," Mark Zandi, chief economist at Moody's Analytics told CNN. The article adds that "Morgan Stanley seems to agree, telling clients that the May jobs report 'continues to point to a soft landing for the economy.'"

As Justin Wolfers, a University of Michigan economics professor put it, "We are not in a recession. People have been telling us we're in a recession for the last two years. They've been wrong each and every day. Employment has grown gangbusters. The data is crystal clear on this. There is no recession."

The sentiment is echoed by the Wall Street Journal, reporting that signs of a recession "remain elusive." Rather, thanks in part to "Government policies in response to the pandemic," WSJ reports "Employers are hiring aggressively, consumers are spending freely, the stock market is rebounding and the housing market appears to be stabilizing."

In short: the Biden economic plan is working — powering a historic economic recovery and building an economy from the bottom up and the middle out, not the top-down. And due to the bipartisan action taken by Congress last week, which protected President Biden's key accomplishments, his Investing in America agenda will continue to deliver good jobs for the American people in communities throughout the country.

Read coverage below:

CNN: The case for a 2023 US recession is crumbling
[Matt Egan, 6/5/23]

[…] But the case for a 2023 US recession is crumbling for a simple reason: America's jobs market is way too strong.

Hiring unexpectedly accelerated again last month, with employers adding an impressive 339,000 jobs in May. Not only is that more than any major forecaster expected, but it's more jobs than the US economy added in any single month in 2019, a very strong year for the jobs market.

"This economy is incredibly resilient, despite all the slings and arrows – despite the banking crisis, rate hikes, the debt ceiling," Mark Zandi, chief economist at Moody's Analytics, told CNN in a phone interview on Friday.

Zandi is growing more confident that 2023 won't be the year when a downturn will begin.

"For this year, given these jobs numbers, it's hard to see a recession. Increasingly, the odds of a recession this year are fading," Zandi said. "A lot of economists who have called for a recession are now in the uncomfortable position of pushing back the start date." […]

"We're running out of time for a 2023 recession," Justin Wolfers, an economics professor at the University of Michigan, told CNN. "We've never had a recession when the labor market was running this hot. In fact, it would be absurd to use r-word at a time when we're creating jobs at this rate."

Not only did nonfarm payrolls soar by 339,000 jobs in May, but the government revised the prior two months of job growth significantly higher, too. Now the Bureau of Labor Statistics says payrolls increased by 217,000 jobs in March and 294,000 in April.

That's miles away from the dark predictions issued not long ago. Last fall, Bank of America warned payrolls would begin shrinking in early 2023, translating to the loss of about 175,000 jobs a month during the first quarter followed by job losses through much of the year. […]

"We are not in a recession. People have been telling us we're in a recession for the last two years. They've been wrong each and every day," Wolfers said. "Employment has grown gangbusters. The data is crystal clear on this. There is no recession." […]

"As long as the economy continues to produce above 200,000 jobs per month this economy simply is not going to slip into recession," Joe Brusuelas, chief economist at RSM, wrote in a report.

Morgan Stanley seems to agree, telling clients that the May jobs report "continues to point to a soft landing for the economy," a Fed term for raising rates without triggering a recession.

Wolfers, the University of Michigan professor, said the risk of a hard landing "looks quite remote."

The Wall Street Journal: Why the U.S. Remains Far from Recession
The pandemic's aftereffects fuel economic resilience despite rising interest rates
[Sarah Chaney Cambon, 6/4/23]

More than a year after the Federal Reserve began rapidly raising interest rates to tame inflation, the hallmarks of a widely expected recession remain elusive.

Employers are hiring aggressively, consumers are spending freely, the stock market is rebounding and the housing market appears to be stabilizing—the most recent evidence that the Fed's efforts have yet to significantly weaken the economy.

Instead, the lingering effects of the pandemic have left consumers and employers still playing catch-up. That momentum could prove self-sustaining.

Americans are splurging on the activities they skipped during pandemic lockdowns, such as travel, concerts and dining out. Businesses are staffing up to satisfy the pent-up demand. Government policies in response to the pandemic—low interest rates and trillions of dollars in financial assistance—left consumers and businesses with lots of money and cheap debt. The same inflation that so worries the Fed translates into higher wages and profits, fueling spending. […]

Job gains, in particular, remain robust, pumping more money into Americans' wallets. Payrolls grew by a surprisingly large 339,000 in May, and the increases for the preceding two months were higher than initially estimated, the Labor Department said Friday.

"I don't think there's any chance we're in a recession," said Justin Wolfers, professor of public policy and economics at the University of Michigan.

The National Bureau of Economic Research, an academic research group and the official arbiter of U.S. recessions, analyzes a slew of economic data to help determine whether the economy is in a recession. Most of those indicators look healthy, Wolfers said. […]

"I certainly did not think the labor market would remain this strong for this long," said Carl Tannenbaum, chief economist for Northern Trust.

Courtney Wakefield-Smith is among those who have recently benefited from the strong labor market. The 33-year-old said she was promoted last year to an office job at a New Jersey water utility company. In her new role, she makes more than $25 an hour, well above her part-time jobs earlier in the pandemic that paid between $11 and $17 an hour.

Her higher wage and benefits including maternity leave are helping support her newborn son. […]

Americans have about $500 billion in so-called excess savings—the amount above what would be expected had prepandemic trends persisted, according to a May report from the Federal Reserve Bank of San Francisco. […]

The number of people passing through U.S. airports during the Memorial Day weekend topped the prepandemic figure from 2019, according to the Transportation Security Administration.