After touting for months the strong employment numbers as a way to deflect criticism of soaring inflation, the White House on Tuesday warned that the numbers released later this week by the Labor Department will likely a jobs markets that is “cooling off.”
White House press secretary Karine Jean-Pierre said the slower hiring pace is a sign that the economy is “in transition.”
“It is going through a transition from the historic economic growth that we saw last year to a more stable and steady growth and that is kind of important to note,” she told reporters aboard Air Force One.
“We are expecting job numbers to cool off a bit as we are going into transition. We are expecting job numbers to not be at the high growth rate,” Ms. Jean-Pierre continued.
The Labor Department on Friday will report on how many jobs were created in August and whether one of the best U.S. job markets in decades has hit its peak. The unemployment rate in July was a record-low 3.5% and employers in industries across the spectrum report difficulty in finding enough workers.
Forecasters have predicted a decrease in hiring for August, with some saying the number of jobs created could slow down by 4.5%.
SEE ALSO: Consumer confidence up in August after three-month decline
A hot labor market has fueled the economy as the U.S. economy transitions out of the COVID-19 pandemic. In July, employers added 528,000 jobs, a stunning number that beat the expectations of analysts and private forecasters.
With inflation rates still high and the Federal Reserve raising interest rates, the labor market is a key indicator of a recession and any weakness could ramp up fears of employment losses. Ms. Jean-Pierre downplayed any links between August’s employment numbers and concerns the U.S. economy is about to plunge into a recession just ahead of November’s midterm elections.
“We are still seeing a strong labor market which is important. Consumer spending is strong, which also matters,” she said. “It is no surprise the way that we have seen it that the economy is doing some slowing down, you know, cooling off.”
The administration may be getting a boost as long-depressed consumers showed signs Tuesday of renewed faith in their economic prospects.
The U.S. Consumer Confidence Index rebounded in August to end a three-month slide. The monthly survey on consumer attitudes now stands at 103.2, up from 95.3 last month and 98.4 in June, according to the Conference Board, which compiles the monthly survey.
How consumers perceive the current business and labor market conditions also improved from July’s 139.7 to this month’s 145.4. And consumers’ short-term expectations for income, business and labor conditions increased from 65.6 to 75.1.
Analysts said the increases in August reflect in part a fall in gasoline prices at the pump after mid-summer increases that put gas at near-record highs.