The latest jobs report presented a sharp decrease in unemployment came as a surprise to many economists, including Creighton University’s Dr. Ernie Goss.
“Job additions at 2 ½ million; that was much greater than what I expected or anyone expected,” Goss told KLIN News Friday.
Dr. Goss is a professor at the Heider College of Business and said that a lot of credit for the good numbers goes to operators on Capitol Hill, both Democrat and Republican.
Goss says the $3-to-$4 trillion in approved stimulus money, along with efforts by the Federal Reserve to increase liquidity, went a long way to softening the blow caused by pandemic related shutdowns.
“We’ve never seen any stimulus programs like this, either from the federal government or, to this degree, the federal reserve,” said Goss.
Even with the good numbers, Goss notes that the unemployment rate is still higher than it was during the Great Recession.
“I think it much too early to break out the champagne,” said Goss. “We have to see many, many, many more reports like this to be convinced that we’re going to get a V-shaped recovery.”
Even so, he says there’s no need for more stimulus money.
He argues that the approved stimulus money, while helpful for the short-term, presents future generations with a financial burden that they will feel via higher taxes, inflation rates, and interest rates.
“We need to see how this plays out,” said Goss.
In the meantime, Goss said that consumers and policymakers should keep their eyes on interest rates.
He says that if interest rates rise, it’s a sign that consumers are getting more comfortable with spending.
Goss also advises that another surge in COVID-19 cases and deaths could negatively affect the economy.