U.S. job growth disappointed in April even as increased Covid-19 vaccination rates fuel demand that’s also seen gathering pace in the U.K.

As wealthier nations get closer to putting the pandemic in the rear-view mirror, the increase in economic activity is expected to continue benefiting export-driven nations including China.

Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:

The U.S.

U.S. economy added only 266,000 jobs in April, well below forecast

Job growth significantly undershot forecasts in April, suggesting that difficulty attracting workers is slowing momentum in the labor market and challenging the economic recovery.

Pandemic Jump

Median monthly rent for available properties was $185 higher than a year earlier in the first quarter of 2021

Source: U.S. Census Bureau

Note: Current dollars; in the first quarter of 2021, the survey was conducted via personal visits 99% of the time in March 2021, up from 97% in Feb. and Jan. The overall response rate for the first quarter of 2021 was 78% down about 1 percentage point the first and fourth quarter 2020

Rents are soaring in many cities as the economy rebounds, squeezing the budgets of tenants who also face increased risk of eviction after courts overturned a pandemic-era ban. The median monthly charge on a vacant rental jumped by $185 in March from a year earlier, according to the Census Bureau. A national index compiled by Apartmentlist.com shows that rents rose 1.9% in April alone, the most in data going back to 2017.


Taking Off

Savings built during the pandemic are expected to fuel a spending surge

Source: Bank of England, Office for National Statistics

The Bank of England expects the biggest surge in household spending since 1988 to help power a strong economic rebound after the pandemic.

Citizen Creditors

Share of euro-area government debt held by households*

Source: European Central Bank

Note: *3Q/2020

Malta, Italy, and the Netherlands rely most heavily on private citizens for government financing within the eurozone, according to new European Central Bank research that highlights the role of individuals in public debt.


China's exports, imports grew strongly in April

China’s exports rose more than expected in April, suggesting its trade out-performance could last longer than expected this year, fueled by global fiscal stimulus.

Emerging Markets

Asian Exception

In the pre-pandemic decade, Asian economies posted much faster growth and lower inflation rates than their emerging-market peers

Source: International Monetary Fund

Classic problems such as rising inflation, capital flight, and concerns over bloating public debt are starting to show up in some emerging markets, but less so in Asia.

Taxing Copper

Chile’s Congress is debating a new mining royalty

Source: Cochilco

*Note: Chile’s proposed royalty, which is based on a progressive rate, considers here a copper price of $4.50 a pound 

Chile’s lower house approved introducing progressive taxes on copper sales in what could become one of the heaviest levies in global mining, potentially stalling investments and boosting prices.


Vaccine Inequality

Rich nations are three years ahead in the vaccination race

Source: Bloomberg News, Bloomberg Economics, International Monetary Fund, World Bank classifications

Note: Reflects total doses administered; assumes 2-dose vaccine regime, herd immunity at 75% of population

At current rates, some rich countries will reach herd immunity by August, but most poorer nations will remain below the threshold through 2024 or later, according to research by Bloomberg Economics.

Pandemic-Related Productivity Acceleration

Acceleration potential in U.S. and Europe, 2019-2024 Compound Annual Growth Rate

Data: McKinsey

The Covid-19 crisis is accelerating a technology boom that has the potential to boost productivity across much of the world, spurring growth even in mature economies such as those of Europe and the U.S.

Equality Concerns

References to ‘inequality’ in central bankers’ speeches have risen

Source: BIS

Note: Share of central bank speeches mentioning the keyword “inequality” and “distributional consequences/impact of monetary policy” in the BIS database; data until February 2021

Economic inequality isn’t caused by central banks, and government officials must play their part in tackling the fundamental reasons for the gap in income and wealth, according to the Bank for International Settlements.

The motion-picture and the sound-recording industry continue to have a hard time adding jobs and moving closer to where employment was before the pandemic.

April's jobs report from the Bureau of Labor Statistics was not what economists expected to see. The consensus estimate was for an addition of 1 million more payroll jobs in April, but last month's gain was only 266,000. Even worse, nonfarm-payroll employment gains were revised down in March from 916,000 to 770,000. 

At the industry-sector level, leisure and hospitality was the biggest winner, with 331,000 jobs added. The second-largest gain was in government, which added 48,000 jobs last month. 

Even with monthly gains and declines, we can look at how April employment in various industries with different typical wages compares with employment from before the pandemic. The following chart shows the percentage change in employment between February 2020 and April. We also included each industry's median hourly wage as of May 2020 from BLS's National Occupational Employment and Wage Estimates program along the horizontal axis.

The motion-picture and sound-recording industry, which falls into the information sector that gained 1,000 jobs in April, lost 3,100 jobs last month. The motion-picture and sound-recording industry has been about 40% below February 2020 employment since September. The performing-arts and spectator-sports industry, which has similarly been far below pre-pandemic employment throughout the pandemic, was 31.3% below pre-pandemic employment as of April. 

"The lack of job growth in many industries most harmed by the pandemic was disappointing," Nick Bunker, an economist at Indeed, said in an email to Insider. "Hopefully the pandemic continues to recede and these industries will be able to add more jobs on a sustainable basis."

The couriers and messengers industry had mainly seen jobs added each month during the pandemic as people ordered things for delivery while staying at home during lockdowns and working remotely. But couriers and messengers had a decline of 77,400 jobs in April. This sector was 23.1% above February 2020 employment in March after 13,900 jobs were added that month. But that difference fell to 14.3% above the pre-pandemic level in April after the industry lost jobs for the first time since December.

"One possibility is that demand for these services is declining as more in-person services and activities reopen," Bunker said. "Employers might be letting workers go because they are uncertain that pandemic-era trends will last much longer." 

The U.S. Chamber of Commerce is calling for Washington to immediately stop paying out-of-work Americans an extra $300 a week in unemployment benefits, saying the boost in government aid is giving some recipients less incentive to look for work.

The business group said Friday that the supplemental unemployment benefit, part of the Biden administration’s efforts to support the pandemic-ravaged economy, results in about one in four recipients taking home more in unemployment pay than they earned when they were working.

The statement follows the release of surprisingly weak jobs data for April. On Friday, the Labor Department said U.S. employers added just 266,000 jobs last month, a big drop from March and well below the nearly 1 million jobs economists were expecting, according to FactSet.

“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market,” said Neil Bradley, the Chamber’s executive vice president and chief policy officer. “We need a comprehensive approach to dealing with our workforce issues and the very real threat unfilled positions pose to our economic recovery from the pandemic.”

U.S. companies have added jobs for four straight months, but some employers complain that they can’t find workers, despite an elevated unemployment rate.

As more people have begun looking for work, more are being counted among the jobless: The unemployment rate ticked up in April to 6.1% from 6% in March.

While some low-income workers may be reluctant to look for work because they are receiving a federal boost in aid, on top of state benefits, other factors may be keeping some Americans from returning to work, including fear of contracting the coronavirus or because they need to care for children who haven’t returned to school.

An economy doesn’t live by demand alone. There is no clearer evidence of that dictum than Friday’s surprising jobs report for April, which undershot the expectations of economists by more than 700,000. Welcome to the slowdown of the supply-side job.

Employers added a net 266,000 jobs in April, while the unemployment rate ticked up 0.1 percentage point to 6.1%. Payrolls for March and February were revised down a combined 78,000, and 48,000 of the new jobs in April were in government, mostly local education as schools reopened.

The report wasn’t a total washout, as private payrolls grew 218,000, mostly from leisure and hospitality jobs (331,000) as the lockdowns continued to ease. But there were large losses in temporary positions (-111,400), couriers (-77,400), food and beverage stores (-49,400), and nursing homes (-19,500). Some of this reflects a reallocation of jobs as businesses reopen and consumption shifts.

The Keynesians who now run U.S. policy, at the Treasury and Federal Reserve, have been using their usual demand-side playbook. Bathe the country in government cash, keep interest rates at zero, and the resulting rise in consumer demand will drive everything.

They’ve underestimated the supply-chain constraints that have been screaming across the economy for months—from too few workers to the computer chip shortage and soaring lumber and freight prices. The economy can’t produce enough goods and

services fast enough to meet the soaring demand from the easing pandemic and government policies that have shoveled cash to consumers and rewarded Americans for not working.

Employers across the country have been complaining for months that the federal $300 weekly jobless bonus has made it difficult to hire. Most lower-income workers can make more sitting on the couch. It’s notable that half of the new labor market entrants last month were teens, most of whom don’t qualify for jobless benefits because of their short or nonexistent employment histories.

This was all predicted a year ago by these columns and a few others, including Sens. Ben Sasse and Lindsey Graham and economists Casey Mulligan and Steve Moore. But even as the economy was growing fast again, Democrats in March extended the $300 weekly bonus into September even as they ladled out a bonanza of other transfer payments.

Democrats claimed their $1.9 trillion spending bill was needed to jolt the economy, though it was fast recovering as vaccines rolled out and lockdowns eased. Now the White House is spinning the jobs miss after its spending blowout as something it expected.

“I want to remind everybody it was designed to help us over the course of a year, not 60 days,” President Biden said Friday, adding that the small job growth is “a testament to our new strategy of growing this economy from the bottom up and the middle out” and underscores the need for more government stimulus.

He also said there was no “measurable” data that people aren’t looking for jobs because it pays more not to work. He should get out more and ask some small business owners. Treasury Secretary Janet Yellen walked that back some by saying unemployment benefits weren’t a “major factor.” But the Labor Department’s latest Jolts survey showed 7.4 million job openings in February. There are plenty of available jobs but not enough willing workers.

The good news for those who are working is that employers are paying more to attract and keep them. Average hourly earnings last month increased at an 8.4% annual rate and even more for lower-income jobs like retail (16.8%) and leisure and hospitality (19.2%). The risk is that these wage increases will become embedded in expectations and lead to more general inflation.

The policy lesson is to ease government constraints on supply. That means repealing the federal bonus not to work. And it should mean withdrawing the Biden tax increases that are a frontal attack on investment and supply. There is no need for more Keynesian stimulus, which has become part of the problem.