The Jobs Report No One Saw Coming

Here is today’s FT headline:

The jobs report no one saw coming

Actually, one person did see this coming. Here’s what I wrote three weeks ago:

Because millions of unemployed workers in low pay service sector jobs earn more on unemployment than they did on their previous jobs, and because most of those jobs are unpleasant, employment will likely remain quite depressed all summer, before bouncing back in the fall. That’s not to say the economy won’t grow.  The end of COVID makes it likely that sectors such as travel will pick up, but the quality of service will be lousy, perhaps the worst of my entire life.

Here’s the FT:

Knightley does pick up on the important trend that employers are struggling to find workers: . . .

This, he tells us, means there is huge demand for workers, but job gains will be held back in the next few months because of a lack of supply.

The reason for that is two fold in Knightley’s opinion: childcare issues and benefit incentives.

Most economists don’t understand supply side economics, and hence most never saw this coming.

PS. I’m on vacation, experiencing some of that lousy service that I predicted.

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