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WASHINGTON—President Trump said Friday the economy would rebound very quickly as the U.S. labor market made a stunning record surge in May, “smashing” market expectations.
“It’s a very big day for our country, an affirmation of all the work we’ve been doing really for 3.5 years,” Trump said during a press conference at the White House.
U.S. employers added 2.5 million jobs in May as 31 states started to reopen their economies and ease restrictions. The jobless rate dropped to 13.3 percent from 14.7 percent in April, far better than expected. The Dow Jones Industrial Average rallied more than 700 points after the jobs report.
“We’re opening and we’re opening with a bang and we’ve been talking about the V,” Trump said, referring to a V-shaped economic recovery, meaning the economy suffers a sharp but brief period of economic decline before rebounding.
“This is better than a V. This is a rocket ship,” he said.
“As good as these numbers are the best numbers are yet to come because so many areas are still closed or very partially closed,” he noted, urging “lockdown governors” to reopen their economies.
The data released by the Labor Department raised hopes that the U.S. economy has started to recover from the pandemic.
Employment fell by 22.1 million between February and April due to the strict lock-down measures implemented across the country to contain the spread of the virus.
Economists polled by Dow Jones were expecting job losses to continue in May, with a decline of more than 8 million jobs and the unemployment rate to reach 20 percent.
Trump said the labor numbers shocked the economists and investors.
“Warren Buffett sold airlines a little while,” Trump said.
“But sometimes even somebody like Warren Buffett—I have a lot of respect for him—make mistakes. He should have kept the airline stocks because the airline stocks went through the roof today, and others did too.”
“We’re going to actually be back higher next year than ever before and the only thing that can stop us is bad policy, frankly, left-wing bad policy of raising taxes and green new deals.”
Many of the job gains in May occurred in leisure and hospitality, construction, education, and health services, and retail trade. Employment continued to decline in government with local public education accounting for most of the decrease.
“Today’s report marks the beginning of the labor market recovery in our view, and we expect the unemployment rate to fall further in June. We are currently reviewing our unemployment rate projections,” Jan Hatzius, chief economist at Goldman Sachs said in a report.
Trump also signed the legislation that makes significant changes to the Paycheck Protection Program (PPP) to help restaurants, hotels, and other businesses that have been hit hard by the pandemic.
The legislation would give small businesses more time to use the relief fund by extending it to 24 weeks from eight weeks. In addition, borrowers would have to spend 60 percent—rather than the current 75 percent—of the funds on payroll to qualify for loan forgiveness.
“I want to thank the Democrats who worked together” on the bill, Trump said.
“I hope we can get along with the Democrats. It’s been a disaster in terms of relationship, but I hope we get along because it’s a great thing for our country.”
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