The United States economy saw the most sluggish month for job growth since COVID-19 and the lockdown-induced recession, according to a Thursday report from ADP.
The payroll processing company reported 128,000 new private sector jobs in the month of May — severely missing the 299,000 estimated by Dow Jones and falling from the 202,000 new jobs created in April, according to CNBC. The results, which come amid news that the United States economy shrank at a 1.5% annualized rate in the first quarter of 2022, constitute the worst employment figures since COVID-19-induced layoffs sent 19 million workers home in April 2020.
Companies with fewer than 50 workers saw payrolls decline by 91,000 employees, CNBC said. The majority of the layoffs — 78,000 — were experienced by companies with fewer than 20 workers.
“Under a backdrop of a tight labor market and elevated inflation, monthly job gains are closer to pre-pandemic levels,” ADP chief economist Nela Richardson said, per CNBC. “The job growth rate of hiring has tempered across all industries, while small businesses remain a source of concern as they struggle to keep up with larger firms that have been booming as of late.”
Between February 2020 and April 2020, the unemployment rate soared from 3.5% to 14.7% — the highest in the modern era, according to data from the U.S. Bureau of Labor Statistics. Unemployment has since fallen to 3.6% as of April 2022, nearing pre-recession levels.
In a Monday op-ed for The Wall Street Journal, President Joe Biden warned that the job recovery would likely slow down as firms finish regaining the positions lost during the recession. However, the most recent job creation figures may already be worse than Biden forecasted.
“During this transition, growth will look different. We will likely see fewer record job-creation numbers, but this won’t be cause for concern,” Biden wrote. “Rather, if average monthly job creation shifts in the next year from current levels of 500,000 to something closer to 150,000, it will be a sign that we are successfully moving into the next phase of recovery — as this kind of job growth is consistent with a low unemployment rate and a healthy economy.”
Beyond the most recent disappointing job figures, the Biden administration has repeatedly sought to take credit for employment rebounds since the recession — without recognizing that much of the job growth occurred as the United States regained lost positions rather than creating new ones from scratch.
“President Biden is building a better America,” a post from the White House claimed in May. “The U.S. economy has added nearly 8 million jobs since President Biden took office and experienced the greatest year of job growth under any President in history last year.”
Likewise, a January tweet from the White House depicted job gains under Biden as several times higher than his predecessors. Washington Post fact-checker Glenn Kessler pointed out that the claim was incomplete at best: “A huge problem with this apples-and-oranges chart: It compares monthly job growth of 4- and 8-year terms with just one year of Biden. Trump used to do the same thing — until his record was spoiled by the job losses in his last year. Don’t count your chickens before they hatch.”