More Americans Jobless Than Biden’s Official Unemployment Rate Shows

The labor market is nowhere near as strong as it appears. If that sounds surprising, it’s because the absence of millions of Americans from the workforce artificially lowers the unemployment rate.

Accounting for the missing workers reveals an unemployment rate of over 6%, not the official 3.8%.

To make sense of the numbers, we need to understand what led to today’s labor market conditions. The two-month recession in 2020 wasn’t a normal downturn caused by bad investment, misallocation of capital, and/or overextension of credit. It was an artificial recession caused by the government forcibly shutting down a robust economy during COVID-19, ending a period of both fast growth and low inflation.

Tens of millions of Americans became unemployed in a span of two weeks. But when those artificial constraints were lifted, the labor market came back at the fastest rate ever and quickly was approaching its pre-pandemic trend. This is the opposite of a normal recession, where the labor market slowly accelerates into a recovery.

President Joe Biden inherited an economy that was growing at a $1.5 trillion annualized rate and was adding an average of 1.4 million jobs per month after the government-imposed shutdowns. At the same time, inflation was only 1.4%, below the Federal Reserve’s 2% target.

But Biden’s anti-growth, big-government agenda slammed the brakes on the economy and the labor market.

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