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This “infiltration” of low-income communities succeeds by not only just appealing to the tactical decision making process of a young student (listing of benefits, etc.), but also trying to manipulate their emotional sense of belonging within their own community. Herbert explains how it comes down to an exact science that is plainly laid-out in an Army publication called “School Recruiting Program Handbook.” The process of “school ownership,” as detailed in the handbook, is primarily responsible for higher numbers of enlistment and happens when recruiters carry-out actions like “contact athletic coaches and volunteer to lead calisthenics, get involved with the homecoming committee and organize a presence in the parade, donate coffee and donuts to the faculty on a regular basis, eat in the cafeteria, [and] target ‘influential students’ who, while they may not enlist, can refer others who might”86 87. Recruiters seemingly take on a nurturing role in the community, giving students the illusion that the military can help solve problems that they may be facing and set them on a productive career path. Given their positionality as both minors and in the midst of a highly transformative period in their lives, high school students are especially vulnerable to undue influence and evidence immature judgement with regard to involvement in risky behavior88. This susceptibility amongst students mixed with the military’s proven disregard of ethical guidelines, even within WEAPONIZATION OF POVERTY 26 its own putative standards, make for an ideal environment for recruiters to coerce students into questionable behavior. One highly publicized case of such activity happened when a recruiter was caught on tape coaching a high school student about how to fake a mandatory drug test89. However, policies regarding the degree of access provided to military recruiters vary from school-to-school and remain heavily reliant on the relationship that a recruiter is able to form with the school’s administrative staff. For example, school guidance counselors, supportive of the military, can greatly facilitate students’ orientation towards joining the military90.

Research suggests that the military knows exactly where to look when carrying out tactics of targeted recruitment. According to a 2004 Boston Globe inquiry into military WEAPONIZATION OF POVERTY 22 recruitment practices, researchers determined, “recruiters target certain schools and students for heavy recruitment, and then won’t give up easily: Officers call the chosen students repeatedly, tracking their responses in a computer program… eligible students are hit with a blitz of mailings and home visits”68. Analysis of the location of JROTC units in the Los Angeles Unified School District (LAUSD), the second largest district in the nation, reveals that these military programs are located in schools serving predominantly low-income Latino and African American students69. As of 2004, sixty-one percent of LAUSD high schools (30 of 49) had a JROTC unit on campus with a total enrollment of 6,000 students70. Individual case study comparisons have been explored as well. In 2004, Whitney Young High School, a large selective magnet school in Chicago, had only seven military recruiter visits compared to 150 visits from university recruiters; Schurz High School, which is 80% Hispanic, had nine recruiter visits as compared to a measly ten visits from universities71. On a national scale, Marshall and Brown (2004) found it far more common for young people from rural areas and from the southern USA to join the military than their northern, urban counterparts. Socio-economically breaking it down, Segal et al (1999) found that perceived interest in the military declined as the grade level increased. Eighth graders had a higher propensity to enlist in the military than did their tenth and twelfth grade counterparts. Furthermore, the study also found that young people from intact homes (two-parent families) are less likely to serve in the military than those in single-parent homes72. Young people whose parents had attained high levels of education were least likely to join the military and respondents who aspired to a college education also indicated a very low motivation to enlist73. Similar findings regarding socio-economic factors broken down by race were reported in a now somewhat dated study by Teachman and Call (1993). They report that among Caucasian 23 males, high mother’s education level and high high-school grade-point average (GPA) were predictors of low military propensity. For African American males, father’s education and GPA showed a low propensity to enter the military74. However, among African American males, higher educational aspirations were a major predictor of higher interest in enlistment, suggesting that military service might be viewed as opening educational opportunities. As for whites, they discovered the highest tendency to enlist directly after high school graduation. White males who were working or enrolled in postsecondary school were far less likely to enlist. Finally, for African American men, work and school were insignificant predictors of propensity to enlist75 76. These findings seem to suggest a relationship between enlistment and an understanding of one’s economic security down the line. Given that the quality of one’s education remains a strong indicator for both economic and social security later on in life, it makes sense that parents would find comfort in the military’s pitch to help educate their child. Furumoto (2005) driveshome how it is the military’s exact strategy to instill this mindset in poor and working class school districts where “many parents lack knowledge about military recruitment practices and the implications for their children”77. Military programs, such as the JROTC, are often touted as a “solution to high dropout rates and failing grades”78. However, Furumoto finds fault in this argument stating, “the assertion that the military is the ‘best opportunity’ to get a college education belies the facts”79

It is often considered a societal goal that the burden of serving in the armed forces does not disproportionally fall on a few social groups (for example, Cooper 1977, CBO 2007, Wright 2012). The Democratic Leadership Council (1988) argued the United States “cannot ask the poor and under-privileged alone to defend us while our more fortunate sons and daughters take a free ride, forging ahead with their education and careers.” The Department of Defense (1997) points out that: “Imbalances in socioeconomic representation in the military have often been a controversial social and political issue. In debate over the establishment of the volunteer force, opponents argued that it would lead to a military composed of those from poor and minority backgrounds, forced to turn to the military as an employer of last resort.” Concerns about population representativeness and shared sacrifice were already important during the American Revolution and the Civil War. Discussing compulsory service, Benjamin Franklin is quoted as having written “The question will then amount to this; whether it be just in a community, that the richer part should compel the poor to fight for them and their properties” (Warner and Asch 2001). A popular saying since the Civil War has been the phrase “It is a rich man’s war and a poor man’s fight.” (Moore 1924).

Five years ago, after decades fighting insurgencies in the Middle East and Central Asia, the U.S. started tackling a new era of great-power competition with China and Russia. It isn’t yet ready, and there are major obstacles in the way.

Despite an annual defense budget that has risen to more than $800 billion, the shift has been delayed by a preoccupation with the wars in Iraq and Afghanistan, the pursuit of big-ticket weapons that didn’t pan out, internal U.S. government debates over budgets and disagreement over the urgency of the threat from Beijing, according to current and former U.S. defense officials and commanders. Continuing concerns in the Mideast, especially about Iran, and the Russian invasion of Ukraine have absorbed attention and resources.

The novel coronavirus disease 2019 (COVID-19) imposed a tremendous burden on various global infrastructures and continues to do so at present. Its effect on the United States military has required multiple adaptations and poses a potential threat to the readiness state of the military. In reference to the National Defense Strategy’s (2022) identified five primary threats, the addition of COVID-19 as a plausible sixth threat to U.S. national security warrants attention based on the direct effect of the pandemic itself as well as the indirect effects on various infrastructures and the other primary threats. Numerous functions of military service require frequent and prolonged interpersonal contact which imparts a challenge given the high transmissibility, unknown long-term effects, and work disability imposed by COVID-19. However, the military must overcome all threats to readiness in order to remain capable of defending the Nation.

This threat to military readiness is one of great concern and unknown duration. It emerged with little actionable warning yet prodigious force. The military has not encountered a biologic threat of this magnitude since the 1918 influenza pandemic (DiEuliis, 2020). Other pandemics of lesser scale such as the H1N1 influenza pandemic of 2009 or earlier avian flu pandemics did not have the global impact of COVID-19 (World Health Organization, 2017). Response to the present COVID-19 pandemic must assert control and continuity of military operations in order to maintain a defensive posture for the United States. This study aims to assess the readiness state of the United States military within an extended COVID-19 pandemic.

President Joe Biden’s proposed $886 billion defense budget sets a U.S. record for peacetime military spending. It’s a new record, perhaps, but also an old story. America’s military forces, defense industries, and a supportive Congress have spent many decades and trillions of dollars preparing to defend our nation against a multitude of threats across the globe. Unfortunately, far too much of this effort has served only to prepare us for facing the threats of yesterday. This is a failure of vision distorted by support for favorite, outworn systems and strategic mindsets that are of declining use against the fast-changing threats we face today, much less those we will face tomorrow.

Complicating attempts to address this challenge is the fact that our defense establishment is likely the most complicated business enterprise in the world. It is a convoluted, cross-threaded system, driven in part by a “military-industrial complex” that is far too influenced by outside factors, constituency pressures and inefficient acquisition systems to allow for a truly effective approach to defending the nation. Even worse, there are very few people who truly understand the system’s complexities well enough to make it work.

With the economy, culture, and overall state of America standing so robust, a new analysis ranks the U.S. military as weak for the first time ever.

This, of course, comes as a great shock to many. With President Biden’s excelling leadership, it’s unclear how the strength and readiness of our military are both slipping.

Visiting the Army’s 82nd Airborne Division in Poland last March, President Biden declared that they are “the finest fighting force in the history of the world.” A U.S. president trumpeting the prowess of the American military is a familiar refrain but a new paper from the Mitchell Institute details an underfunded U.S. Air Force which may not be able to win against China. Entitled “Decades of Air Force Underfunding Threaten America’s Ability to Win,” the paper outlines the decline in relative spending on the Air Force, the decreasing number and increasing age of its tactical aircraft fleet and the prospects it faces if funding for modernization and new aircraft is not made available. The paper makes for stark reading. In the first paragraph, the authors, retired Air Force Lt. Gen David A. Deptula and former Air Force Col. Mark Gunzinger, plainly state that the USAF “now lacks the capacity to fight a peer conflict, deter elsewhere, and defend the homeland as required by the National Defense Strategy.” The decline in combat power and morale in the Air Force has been self-evident to those paying attention. Flying hours are one of the key barometers to overall readiness, force mentality and esprit de corps. In 1990, Air Force pilots averaged approximately 29 flight hours per month. In fiscal 2021, flying hours across all types of aircraft in the active-duty force averaged 10.1 hours per month, up from just 6.8 per month in 2019. In decades past, Air Force pilots cited their experience and training as a competitive advantage over greater numbers of technologically improving aircraft fielded by U.S. adversaries. By 2013, they could no longer boast. That year, USAF General Herbert Carlisle, commander of Pacific Air Forces, noted that training hours for U.S. pilots had dropped to the level once occupied by Soviet pilots during the Cold War. American pilots flew fewer training hours than Chinese, Indian, or some European pilots. That trend has largely remained, buffeted by other anxiety producing numbers. For the last five years the USAF has hovered around 2,000 pilots short, unable to attract, produce and retain sufficient numbers of people to fill its cockpits. The lack of people is more than matched by a lack of equipment. The Mitchell paper points out that the service now has less than half its fighter force and only one-third of the bombers it had in 1990. “Its latest proposed budget divests about 1,000 more aircraft than it buys over the next five years, which will create an even smaller, older, and less ready force in the near term,” Deptula and Gunzinger note. That force now stands at 2,176 aircraft. It compares with a fleet operated by the People’s Liberation Army Air Force of China and its sister branch, the PLA Naval Air Force, of around 1,700 combat aircraft. The running commentary regarding the numbers has been that the tight margin is “not that scary” given the quantity of older, 3rd and even 2nd generation tactical aircraft in China’s fleet, let alone 4th and 5th generation equipment. The PLA’s lack of combat experience and constricted training approach ameliorate the threat goes the logic. But the numbers of aircraft and pilots are absolutely scary when one considers that China will almost certainly choose any future conflict on its own terms. If it does, it will bring the full weight of its numbers and strength (including surface-to-air missiles) to bear in its own back yard. America will inevitably fight with smaller forces 7,000 miles from its own shores. Those forces are being depleted. With respect to the Air Force, the nadir, the Mitchell paper notes, will occur at the same time that USINDOPACOM warns China will be prepared to conquer Taiwan—2027. As former USAF weapons systems officer and Chief of Fighter Programs, Legislative Affairs for the Secretary of the Air Force, Mike Benitez, noted in a recent Mitchell Institute podcast, “One of the enduring principles of all joint operations is mass... Capability is not a replacement for mass. It goes against doctrine. It goes against history. It goes against how air operations work.” Yet, the Mitchell paper argues, the Air Force has been compelled to substitute capability for mass for the last three decades. Bad Math The so-called “peace dividend” that America’s leaders sought to harvest after the fall of the Soviet Union in 1991 inspired three decades of reduced spending on modernizing and maintaining the strength of the U.S. military. There is a distinction between investing for modernization and capacity and spending on conflicts in Bosnia, Iraq and Afghanistan. Deptula and Gunzinger raise another one - the difference between the budget numbers allocated to the Air Force and what it has actually received. They point out that in its latest budget, the Biden administration asks Congress to fund a smaller allocation for the Air Force in Fiscal Year (FY) 2023 ($169.5 billion) than it requests for the Navy ($180.5 billion) and the Army ($177.5 billion). However, it doesn’t look that way to a casual observer. The USAF’s true budget the authors note is masked, as in previous years, by an arcane DOD practice that reports it is requesting $209.6 billion for the service in FY23 “The $40 billion difference is money that will ‘pass-through’ the Air Force’s budget and go to non-Air Force organizations and programs,” the paper notes. “The Air Force cannot use this pass-through funding to buy new aircraft, increase its readiness, and otherwise organize, train, and equip its forces.” For context, the paper illustrates, the $40 billion difference would buy the Air Force 400 5th generation F-35A fighters designed to fight in the high threat operational environments the U.S. would face against China or Russia. While calling for dropping the deceptive reporting practice, the Mitchell paper asserts that (not counting pass-through funding) USAF budgets have “chronically lagged” those of the Navy and Army. The Army and Navy it says received about $1.3 trillion dollars and $914 billion dollars more, respectively, than the Air Force after removing pass-through between 2002 and 2021. The paper also points to budget allocation precedent set after 9-11. Prior to the 2001 terrorist attacks, the Army, Navy and Air Force received relatively equal funding. But in the press to fight the global war on terror, congress increased funding for the Army by nearly 250% between FY01 and FY08. The Air Force’s budget “increased by a far more modest amount.” That has come at an additional cost to national security. Mark Gunzinger argues that the peer threat to the U.S. lies in a region - the Pacific - where the most important forms of force projection are airpower, space, maritime and cyber - not ground forces. He’d likely find disagreement from historians who point out that wars have only been won by holding and occupying ground. But one might counter that effective control of the domains mentioned above should be enough to prevent war in the first place. Whatever inter-service funding imbalance and friction exist the fact is that the U.S. Air Force is too small for the job it may be asked to do.

Two decades of direct and indirect conflict involving the US military has degraded its combat readiness, the Government Accountability Office (GAO) has found. Washington went to war in Afghanistan after the September 11 terrorist attacks and invaded Iraq in 2003 to topple former leader Saddam Hussein. Last year, the US government began sending billions in military aid to Ukraine to help counter Russia’s invasion of the country. The aid included Patriot missiles, HIMARS rocket launchers, and anti-tank and anti-aircraft weapons. The GAO stated that while the military is working to rebuild and restore its readiness, it continues to face major challenges. For example, the US Navy is experiencing a ship maintenance backlog of $1.8 billion. Maintenance and supply issues also limit the readiness of some aircraft. Additional Problems GAO director Diana Maurer also reported that the US military’s mission capability has declined since 2017. She said that while the US Army and Marine Corps improved in the ground domain, there were significant declines in the sea, air, and space domains. “For example, only two of 49 aviation systems met their annual mission-capable goals. The vast majority missed by over 10 percent,” Maurer explained. In addition, the country’s F-35 program suffers from a variety of sustainment woes, causing a yearly decline in its mission capable rates from 2020. The US Air Force, Navy, and Marine Corps are also facing substantial gaps between the costs of operating an aircraft and what they can actually afford.

Q: What changes does this NDS call for in terms of force structure, either manpower levels overall or -- or where they're postured around the world, where troops need to be around the world, whether that's increasing or -- or stabilizing this 100,000 number in Europe, something like that? And what are your concerns about the recruiting environment and being able to meet those needs going forward?

SEC. AUSTIN: I'm confident that we'll have the force, Meghann, to -- to execute our strategy. And in terms of our force posture, we went through a force posture review very early on. There were incremental adjusted -- adjustments from time to time to that force posture laydown that we -- we provided. And again, we have the ability to rapidly deploy capability to -- to Europe, and you saw that exercise at the very beginning of this conflict as we deployed forces from -- heavy forces, armed forces from the United States to -- to Europe very, very quickly. We could do that because of thing -- the things that we'd done with the European Defense Initiative, and we -- we established pre-positioned equipment sites that troops could fall in on very quickly. And so those things have worked out very, very well for us.

Force Size Does Not Equal Military Capability In 2012’s presidential debates, President Barack Obama addressed Governor Mitt Romney’s criticism about downsizing the Navy by challenging his metric: “Well, Governor, we also have fewer horses and bayonets, because the nature of our military’s changed. We have these things called aircraft carriers. . . . The question is not a game of Battleship. . . . It’s what our capabilities are.” Of course, it’s important to identify the appropriate end strength for the Army. But doing so in a way that directly correlates troop numbers and military strength is an error, much like the strategic miscalculation behind Saddam Hussein’s Gulf War hubris in promising the “mother of all battles” before his army’s defeat in a one-hundred-hour ground war by technologically superior rivals. Using troop numbers as a measurement of military strength, rather than as one of several components of it, owes much to overly general definitions of readiness, as the Cato Institute’s Benjamin Friedman laments: “The general concept of readiness often happens without a conversation about what the forces are for. [Advocates of a larger force] do not know exactly what they want to do, except that they want a bigger military.” Critics have pointed to the Army’s bias toward vast offensive maneuver forces as a strategic miscalculation, particularly dangerous as rivals refine hybrid and political warfare strategies to undermine America’s international influence, circumvent our conventional dominance, and exploit vulnerabilities within democratic societies. Operations targeting our electoral system, like Russia’s Translator Project, offer disproportionate strategic returns on investment; in 2016, just eighty people targeted millions of Americans in “purple states” on social media. While the US Army has organic information operations capabilities, a Rand Corporation review discovered US strategy tends to focus externally and neglect attacks against “zones of interior” (i.e., the US homeland) leaving our strategy “incomplete” and “of declining relevance to the likely future international strategic environment.” The global operating environment and the character of warfare are changing—and the military has a vital role to play amid rising levels of global competition. And as the Army rightly embraces new capabilities, like the security force assistance brigades and expansion of cyber operations, it may be time to reconsider the way it conceptualizes military capability, and the role that troop numbers play in that framework.

[Michael O’Hanlon, director of research for the foreign policy division of the brookings institute, director at the Strobe Talbott Center for Security, Strategy, and Technology, Co-Director of the Africa Security Initiative, Senior Fellow of Foreign Policy at Strobe Talbott Center for Security, Strategy, and Technology, and the Philip H. Knight Chair in Defense and Strategy] 10/4/2019, “Why we need a more modern and ready military, not a larger one”, accessed 6/25/2023

As they get their feet on the ground and look for lodestars to help manage these enormously demanding portfolios, Esper and Milley should remember one key insight from their recent Army experience: Ensuring a high-quality and modernized force is much more important than enlarging the U.S. military at this juncture. Unfortunately, the Air Force and Navy have not yet accepted this basic message; each service aspires to grow its combat force structure by roughly 25% in the years ahead. This is a mistake. Even though the 2020 national defense budget will approach $750 billion, substantially above the Cold-War average in inflation-adjusted dollars, there will not be enough money to do everything. Moreover, President Trump himself projects flat defense budgets in the years ahead, and a number of the Democratic presidential hopefuls promise cuts. All the more reason that the Pentagon must prioritize. According to official policy, the Navy wants to increase the size of its fleet from some 285 ships to 355. In fairness, that latter goal dates back to the latter Obama years, so it is not a Trump administration creation. The Air Force came out with a plan last fall to increase its own force structure from 312 operational squadrons to 386 (of all types of aircraft combined, and including the Air National Guard and Air Force Reserve). Even the Army wants to grow, it must be acknowledged — but in a much more measured and restrained way, to about 500,000 active-duty soldiers from the current 480,000. There are good reasons for the services to want larger forces. Our soldiers, sailors, Marines, and airmen are often fatigued and stressed from extended deployments. And we have been asking a lot of their equipment as well. The solution, however, is not a larger force, but a more consistently funded and more modern one. For all its problems, readiness is strained but not broken, and many of the fundamentals of the force are sound. Better management of existing forces by the military services would help a great deal, too. The Army is overworked partly because it maintains deployments of several thousand soldiers in South Korea and Poland through frequent rotations of multiple units, rather than the more efficient approach of permanently stationing individual brigades in these locations. The Air Force could consider similar changes in how it maintains key units in parts of the Middle East. Several fighter squadrons could, for example, be based in Gulf states rather than rotated in and out. The Navy still focuses too rigidly on maintaining permanent presence in the broader Persian Gulf and Western Pacific regions. More flexible and unpredictable deployments can ease strain on the force without giving adversaries any solace. The Navy can also consider crew swaps while ships remain at sea, rather than bringing crews and ships home from deployment together every six to eight months as is now the norm. With these kinds of adaptations, and improved readiness resulting from more consistent budgets, the size of today’s force can prove adequate to the tasks at hand. By contrast, quality must improve, and modernization must intensify. That is not because the U.S. military is obsolescent. Rather, the pace of innovation in key areas of military technology, and the way in which vulnerabilities in our existing military could be exploited by Russia or China, require it. If we fail to make the U.S. military more modern, resilient, lethal, and survivable, the perception could grow that relative American combat power was fading — or that the American military had developed systemic vulnerabilities that an enemy could exploit to produce catastrophic failure. Deterrence could weaken. War could result. And we could quite possibly even lose such a war.

As the U.S. military becomes more technologically advanced with unmanned weapons such as drones, the various branches likely require less people. In addition, such work as IT services and jobs like painting ships can be farmed out to civilians. Despite this, Asch said military recruiting requirements "reflect the technology." But does this mean national security is at risk? Does the military lack the forces needed to defend the nation if it were attacked? Hewitt said the Army does not expect its recruitment "shortfall to negatively impact our ability to fulfill our requirements as outlined in the current National Defense Strategy." Asch also said that for the time being, national security being endangered is not a major concern. She said if a military branch is lacking in manpower, "what will happen is they'll just be delayed on lower priority things ... It becomes more of a problem of operational capability if this is an ongoing problem for a few years ... If the recruiting problem is sustained for a while, maybe even the higher priority units will start having issues potentially."

Certainly, if the UBI does tighten the labor market, it would not be the single culprit. There are a lot of other forces that have tightened the labor market and put upward pressure on wages in various sectors. But they have been implemented nonetheless because the good that comes from them is thought to override the potential harms of a tighter labor market. One such example is credentialing. In several fields that have become professionalized over the years, in the name of quality assurance, communities have put in place rigorous licensing or certification requirements for practicing certain professions. Clearly, there are reasons why this has been done—you want to know that the doctor who is going to operate on you is someone who has passed a medical licensing exam. But licensing has crept into several professions, and the arguments for needing a board certified physician might not be as clearly applicable to all the various professions for which one must now become credentialed, such as law, real estate, accounting, social work, nursing, architecture, etc. For argument’s sake, let us grant that these licensing and/or certification requirements are necessary. The impact that they have, perhaps intentional, perhaps not, is that they make these professions more exclusive. In other words, more individuals might enter these fields if there were not these rigorous entry hurdles to overcome. Thus, the available labor pool in these fields will shrink, and there will be an upward pressure on wages for the employers of this specific workforce, thereby increasing the costs consumers will face who require these services. And the trend in professional credentialing continues to be on the rise as the general public increasingly demands mechanisms for ensuring quality, led by government or credentialing bodies, to signal that service providers have met a benchmark standard of competence. No matter the original intent, the consequence is that employers of workers in these occupational titles increasingly will have to pay higher wages both to hire them, and to retain them. “Jobs, jobs jobs!” This popular political rallying cry is a second culprit for a tighter labor market. Politicians so often focus on the necessity of creating more jobs in order to grow the economy. But more jobs results in a higher job-to-worker ratio, which, in turn, puts upward pressure on wages. There has been some coverage in the press about the emergence of a tighter labor market in recent months in certain sectors of the economy that lends credence to this idea (Steinhauer, 2018; Casselman, 2018). [1] More importantly, society aspires to grow the economy in order to create more jobs in order to increase wages for workers—this is the goal, not some negative outcome to be avoided. It is important to point out in the UBI debate that an upward pressure on wages is not, in and of itself, a terrible outcome, and, in fact, may very well be a desirable one. In fact, in the two articles cited above, the reporters point to employers who are getting quite creative in their strategies both to recruit and retain workers, offering benefits such as health insurance, paid time off, and flexible work schedules, and even offering employment opportunities to those who heretofore have found it challenging to find jobs, such as ex-offenders, young people, people with criminal records, people with disabilities, people with shoddy work histories, women, minorities, the formerly homeless, ex-addicts, those with no high school diploma, to name a few. Some employers are increasingly hiring workers who don’t have any prior work experience, let alone any industry-specific work experience, and offering them on-the-job training. In some instances, employers are even offering tuition reimbursement so that workers can go to school or wipe out past tuition debt. If a UBI has a similar effect, perhaps that would not be a catastrophe.

Today, the U.S. Department of Labor’s Bureau of Labor Statistics released the monthly Jobs Report which shows the unemployment rate has dropped to 3.4% with more than a half million jobs created in January and 800,000 manufacturing jobs created in the last two years. “President Biden’s economic plan is working,” said Commerce Secretary Raimondo. “When President Biden took office, the unemployment rate was 6.3%. Today, it is just 3.4%. That’s the lowest in 54 years.” Also last month, the Commerce Department’s Bureau of Economic Analysis reported Gross Domestic Product (GDP) grew at 2.9% for the last quarter of 2022 and that real wages were higher last month than they were seven months ago. “Last quarter, we experienced strong growth in GDP, consumer spending, and disposable income,” said Raimondo. “We have more work to do, but we’re building a strong economy that works for all Americans.” In addition, there was near record low unemployment among the Black population (5.4%) and Hispanic population (4.5%). Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and health care. Employment also increased in government, partially reflecting the return of workers from a strike. “Let’s not forget where we were when the President took office – the economy was in crisis,” said Raimondo. “Now, we’ve achieved record job creation, record low unemployment, and a record number of small business applications. America is on the move once again.”

Expectations heading into this morning showed projections of about 180,000 new jobs having been added in the United States in April. As it turns out, according to the new report from the Bureau of Labor Statistics, those projections turned out to understate what appears to be an extension of the hot job market. CNBC reported this morning:

Job growth fared better than expected in April despite bank turmoil and a decelerating economy, the Labor Department reported Friday. Nonfarm payrolls increased 253,000 for the month, beating Wall Street estimates for growth of 180,000, according to the Bureau of Labor Statistics. The unemployment rate was 3.4% against an estimate for 3.6% and tied for the lowest level since 1969.

We hear every day from our member companies—of every size and industry, across nearly every state—they’re facing unprecedented challenges trying to find enough workers to fill open jobs. Right now, the latest data shows that we have 9.9 million job openings in the U.S., but only 5.8 million unemployed workers.

How did this happen?

High interest rates, a recent banking crisis and Washington’s fight over the debt ceiling may have shaken the US economy recently, but the US jobs market continues to show signs of strength. The US Bureau of Labor Statistics (BLS) reported 339,000 jobs were added in May, surpassing forecasts that predicted the increase would be approximately 190,000 jobs and a sign of continued growth from the jobs market despite the Federal Reserve’s continuing efforts to cool the economy. Growth in the labor market has fluctuated over the last few months, dipping down to 165,000 jobs in March and coming back up to 253,000 jobs in April. The number of jobs added is still down compared with this time last year, when 390,000 jobs were added to the economy. Despite more jobs being added to the economy compared to the previous month, the unemployment rate in May went up 0.3% to 3.7%. The 3.4% unemployment rate in April was the lowest seen since 1969. The leisure and hospitality industry continued to add more jobs as the warmer weather has seen more people traveling and eating at restaurants. Construction, transportation and warehousing and social assistance also saw an increase in jobs this month. Reports from earlier in the week indicated that while growth is slowing, the labor market remains hot. The payroll company ADP’s report of private payrolls in May showed an increase of 278,000 jobs, surpassing forecasts of 180,000. BLS’s Job Openings and Labor Turnover Survey showed that job openings unexpectedly rose in April, from 9.7m openings in March to 10.1m openings in April.

Across much of the country, the jobs market is as strong as it’s ever been, and Black women, young people and people with disabilities are among the workers benefiting, recent U.S. Bureau of Labor Statistics data show. Twenty states reported an unemployment rate under 3% in April, while 15 states saw record lows, led by South Dakota at 1.9%, followed by Nebraska at 2%, and New Hampshire and North Dakota at 2.1%. The national rate was 3.4%. Other states that saw their unemployment rates reach levels not seen since the BLS began recording them in 1976, include Alabama, Arkansas, Kentucky, Maryland, Maine, Montana, Ohio, Pennsylvania and Wisconsin, according to BLS data released on Friday. Wisconsin broke new records in April for both low unemployment and new job creation. The state’s unemployment rate dropped to 2.4% and Wisconsin counted more than 3 million jobs in April, a gain of 51,500 from a year ago and 9,600 jobs ahead of the number recorded at the peak in early 2020, just before the COVID-19 pandemic.

Mark Vitner, chief economist at Piedmont Crescent Capital in Charlotte, North Carolina, said major metropolitan areas and emerging metropolitan areas in the South have benefited from recent shifts in the labor market. In Florida, the labor market in Miami, Fort Lauderdale, West Palm Beach, Orlando, Tampa and Jacksonville has been growing rapidly, he said.

Payroll employment posted a solid increase of 253,000 jobs last month, and the unemployment rate ticked down to 3.4 percent, the lowest unemployment rate since May 1969. Because monthly data tend to be somewhat “noisy,” we at the CEA find it useful to look not just at the monthly number, but at the three-month moving average. This procedure helps us separate the signal, or more persistent trend, in the data relative from the monthly noise.

Factoring large downward revisions of 149,000 to the monthly gains in February and March, the average over the past three months is 222,000. As this point in a labor market expansion that’s been ongoing for about three years, this is a solid number, representing a pace of employment growth that is creating robust opportunities for those in or entering the job market.