Biden keeps confronting a good problem: A hot labor market

CNN/ Newswire | 3/10/2023, 11:41 a.m.
President Joe Biden touted a hotter-than-expected February jobs number on Friday as a sign that his agenda is working, even …
President Joe Biden talks about his proposed FY2023 federal budget during an event at the Finishing Trades Institute on March 9 in Philadelphia, Pennsylvania. Mandatory Credit: Chip Somodevilla/Getty Images

Originally Published: 10 MAR 23 06:00 ET

Updated: 10 MAR 23 12:14 ET

By MJ Lee and Betsy Klein, CNN

(CNN) -- President Joe Biden touted a hotter-than-expected February jobs number on Friday as a sign that his agenda is working, even as the Federal Reserve considers increasing its pace of interest rate hikes in the coming weeks as a part of its ongoing efforts to tame inflation.

The US economy added 311,000 jobs in February, according to the latest monthly employment snapshot from the Bureau of Labor Statistics, released Friday. That's a pullback from the blockbuster January jobs report, when a revised 504,000 positions were added, but shows the labor market is still going strong.

"I think we got a good jobs report. I'm happy to report that our economy has created over 300,000 new jobs last month," Biden said in remarks from the Roosevelt Room.

It is yet another sign that Biden continues to confront a bit of a problem -- or, as White House officials would insist, a good problem -- in the form of a hot labor market.

When it comes to one of the thorniest domestic challenges of Biden's presidency -- inflation -- White House officials say they're keeping their eyes on longer-term trends over any one month-to-month fluctuation. Keenly aware of the huge political implications of inflation heading into 2024, they say they remain encouraged that prices have fallen significantly compared to last summer.

The January report blew economists' expectations out of the water and was yet another stark indication of just how hot the labor market remains, despite the central bank's extensive efforts to aggressively raise interest rates to try to cool the economy and bring down prices.

White House officials watched closely and took note when Federal Reserve Chairman Jerome Powell made clear this week in Washington that the central bank was prepared to bring back higher interest rate hikes if, in part, jobs data continued to come in unexpectedly strong.

"The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated," Powell testified before lawmakers this week. "If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes."

But even as they are rooting for a weaker jobs report than the previous month's, White House officials also say they could not deny that more jobs is simply a good thing -- that more paychecks for more Americans is a critical indicator of the general strength of the economy. It is also one of the biggest reasons that some administration officials are still quick to dismiss some economists' predictions of a possible recession.

Biden conceded that there is still "more work to do" and that there "may be setbacks along the way." But he cast GOP lawmakers as "the biggest threat to our recovery," calling out "reckless talk" by "MAGA friends" and "Republicans in the United States Congress" as the US barrels toward the debt limit deadline this summer.

Biden offered a less-than-welcoming olive branch to his political opponents.

"I believe we should build on our progress, not go backwards. So I urge our extreme MAGA Republican friends in the Congress to put their threats aside. Join me in continuing the progress we've built. We got a lot more to do. So let's finish the job," he said.