US employers keep on hiring despite growing trade concerns
- Author: Sonia Alvarado Jun 03, 2018,
Jun 03, 2018, 20:37
The night before, under long-standing tradition, the president and several senior administration officials - including the Treasury secretary and the chairman of the Council of Economic Advisers - are briefed on the numbers, which they are not supposed to disclose until the report is made public at 8:30 a.m. He had never issued such a tweet before.
A number of US employers, from seafood processors to hotels and restaurants, have complained that they can not fill jobs with domestic workers and were shut out of the visa process, which this year was run as a lottery for the first time rather than the usual first-come, first-served basis. That means traders were probably making investment decisions based on signals they took from Trump's post.
The Bureau of Labor Statistics announced at 8.30am that the USA had added 223,000 new jobs in May as the unemployment rate slid t0 3.8%, its lowest level since April 2000 and one of the lowest levels since after the second world war.
Austan Goolsbee, who served on the Council of Economic Advisers during the Obama administration, suggested President Trump's tweet may have been illegal.
The jobs data come out once a month and often can lead to massive buying or selling trends on Wall Street, depending on how the information is received. His tweet came in an hour before the jobs report was officially released by the Bureau of Labor Statistics. A select number of administration officials receive the data the day before, but officials are prohibited from tipping their hand about what the numbers reveal.
"It's a judgment call", Kudlow said. Whether or not Trump actually told anyone, Wolfers explains, "You just don't want to raise that perception".
Former Obama and Bush administration officials noted Trump had appeared to break the federal protocol.
USA to push steel, aluminum tariffs on EU, Canada and Mexico
The move will likely trigger serious retaliation from the three countries and push the U.S. to the edge of a trade war. NAFTA negotiations are deadlocked over tough protectionist demands from the United States.
"The labor market is tightening rapidly and declines in the unemployment rate are likely to continue, but at a slower pace", Ben Herzon, an economic analyst at IHS Markit, wrote in a research note.
Then there's the fact that a tweet like this from the President can move markets, creating a big potential downside for future reports.
Speaking to reporters ahead of his departure for Texas on Thursday, Trump spoke glowingly about the "best unemployment we've had in many, many decades", though it's unclear if he was just speaking generally about the state of the economy or was speaking specifically to the content of the May report.
"He chose to tweet", Kudlow said, asserting that Trump had followed both the rules and past practices.
Larry Summer, former director of the National Economic Council, lamented how former President Bill Clinton and Barack Obama would have been in hot water had they commented on unreleased figures.
Jason Furman, who chaired the Council of Economic Advisers in the Obama administration, said he anxious the decision would introduce instability into markets and appear to politicize statistics.
That's because it's critically important that these statistics, which comes from the nonpartisan federal Bureau of Labor Statistics, are apolitical.
But Mr. Trump, who was briefed on the numbers Thursday evening, appeared to foreshadow the strength of the latest report on Friday morning on Twitter.