The sudden plunge in the unemployment rate just reported for May is a reminder of — for all the setbacks of the past few months — the extraordinary power of the Trump economy and the American free enterprise system. The economy added 2.5 million jobs last month, bringing the jobless rate down to 13.3% from the 14.7% recorded in April. Given that expectations were running closer to 20%, or more, it’s just a remarkable report.
It would be imprudent to make too much of this. There’s a long way to go. Yet it would also be unwise to fail to mark such good news as there is. Savvy readers of the 42-page release from the Bureau of Labor Statistics point us to the chart that tallies jobless persons by reason of unemployment. It shows that of the 18.3 million job losers and persons who completed temporary jobs, a stunning 15.3 million are on temporary layoff.
That means there’s much more room for sudden further improvement in the jobless rate as Americans and their employers test how safe it is to go back to work. The President’s top economic adviser, Larry Kudlow, marked this point even before these numbers came out. Mickey Levy of Berenberg Capital now anticipates “much larger increases in employment beginning in June as the economy continues to reopen.”
The early return to work vindicates Senator Susan Collins of Maine. She was an early advocate of the Payroll Protection Program, which, some economists are suggesting, worked better than expected. It provides businesses with loans that are forgivable if employees are retained on payroll. The program was enacted late in March and by May was providing incentives to rehire. May it boost Ms. Collins in her reelection battle.
The May jobs report also raises the question of what Congress should do about unemployment benefits that start to expire this summer. The $2.2 trillion CARES Act enhanced state unemployment benefits by $600 a week. Democrats are maneuvering to extend that into next year. Today’s jobs numbers suggest that mightn’t be necessary — and could even be counterproductive, curbing incentives to return to work.
This moment is just made to order for one of President Trump’s patented “America is open for business” speeches. It’s clear that in recent weeks the President has been off his game, furious at the cynicism with which the Democrats are trying to exploit the violence with which radical factions have disrupted the anti-racism protests. He’s galled by the new outbreak of moral preening toward his administration from the liberal elites.
This is a moment for a speech about the upside that beckons if we as a country can lay aside our fears. Let Vice President Biden try to run for president on a plank that says as many as 15% of Americans are “just not very good people.” It’s already being written up as the 2020 version of Hillary Clinton’s jibe about how a quarter of Americans are a “basket of deplorables.” The defining quality of Americans right now is they want to work.
One thing Mr. Trump could talk about is this simple fact. The Great Depression was a result of policy errors. All economies go through recessions. It was policy errors — government meddling, tariffs, monetary manipulation, government hostility to big business and its captains — that consumed the 1930s. This election is between a party that, in the Democrats, seems determined to repeat those errors and the party that, in the GOP, seeks to avoid them. What a Trump moment.