The US economy feels lousy for many people. A majority of Americans say President Joe Biden’s policies have made economic conditions worse, according to a CNN Poll conducted by SSRS.
So you'd think some really, really, shockingly good news about the job market would give Americans' spirits a boost.
It won't. Here's why: Inflation is still biting. Prices continue to rise faster than anyone would like. Although annual price increases aren't in wild-runaway mode like they were when inflation was above 9% last year, inflation is still above 3%, which is higher than economists say is healthy.
When you see gas prices at $3.75 on average (and above $4 in plenty of places across the country), mortgage rates above 7% and at a 23-year high, food prices going up at the grocery store, and a restart to student loan payments for millions of Americans, a robust job market won't make most people feel like the economy is strong.
In fact, a strong jobs market may ultimately make many Americans feel worse. How? The Federal Reserve is working to slow the economy by hiking interest rates — the only tool it has to fight inflation. A still-robust job market means the central bank could continue to increase rates without fear of sending the economy into a recession.
JPMorgan CEO Jamie Dimon repeated in recent weeks his fear that rates could go to 7%. Government bond yields are rising to multi-year highs in expectation that rates could go up — and loans pinned to those yields, including mortgages and credit card rates — are set to go up, too.
We should never cheer a bad job market. But a job market that has remained this healthy for this long really isn't excellent news for average Americans struggling to pay their bills. Meanwhile, we remain in a "good news is bad news" conundrum that makes most people feel like the US economy is in a bad spot.