Washington Insider-- Monday

Job Growth Seen Slowing

Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.

Speculation Rising On Potential USDA Chief In A Biden Administration

The parlor game of who will take various posts in a potential Biden administration is in full swing in Washington with several names on the list of those who could head up USDA.

Obvious potentials including defeated lawmakers such as House Ag Chairman Collin Peterson, D-Minn., and former Sen. Heidi Heitkamp, D-N.D., who served on the Senate Ag committee from 2013 to 2019 and was reportedly considered by Trump to head USDA under his administration.

Other possibilities include former USDA officials Michael Scuse (now Delaware's Ag Secretary) and Krysta Harden (former deputy secretary and chief of staff to former USDA Secretary Tom Vilsack). Others on the mounting chatter list include current Rep. Marcia Fudge, D-Ohio, and Land O'Lakes CEO Beth Ford.

Other names are likely to surface in coming days and could well include a candidate not on anyone's list.

Cotton, Soybean Groups Challenging EPA Restrictions on Dicamba

Soybean and cotton growers are challenging the EPA's recently announced restrictions for using the herbicide dicamba, claiming the new, more stringent conditions will disrupt growing seasons.

The American Soybean Association and Plains Cotton Growers Inc. filed a complaint Wednesday in U.S. District Court for the District of Columbia opposing the EPA's October 27 decision to allow the continued use of dicamba on tolerant crops, but with additional controls. The groups said in court filings that the restrictions “will limit growers' ability to respond to weather, pestilence, and other acts of God that significantly reduced yields and increase operational costs.”

They noted that spring rains, flooding, wind and hail “can force soybean and cotton growers into planting or replanting their crops as late as June.”

EPA is restricting soybean growers from applying dicamba products after June 30 each year, while cotton growers face the same restriction after July 30 each year. They also took issue with the buffer requirements that EPA announced.

The trade associations asked the court to remand those restrictions in the EPA's registrations for dicamba products, claiming the buffers and time restrictions are arbitrary, capricious, an abuse of discretion, and not otherwise in accordance with law.


Washington Insider: Job Growth Seen Slowing

The Washington Post, and many others reported last week that the U.S. economy added 638,000 jobs in October. Still, the report was largely seen as “the latest sign that the economic recovery has slowed compared with earlier in the summer, amid rising coronavirus cases that continue to weigh on the recovery.”

The unemployment rate fell to 6.9% from 7.9%, based on data gathered during the first half of the preceding month. Eleven million people remain unemployed, the survey found — about twice the number in February before the crisis.

However, the jobs-added figure was the smallest monthly gain since May, when the economy began adding back some of the 22 million jobs lost early on in the pandemic. “The unemployment rate dropped more than expected, and on the back of an increase in the labor force and no increase in permanent layoffs,” said Daniel Zhao, a senior economist at Glassdoor, who called the report “positive” although he noted that the pandemic remains a major concern.

The gains were driven by hard-hit industries such as leisure and hospitality, which added 271,000 jobs; restaurants, bars and other food service places, which added 192,000; retail, which added 104,000; and arts, entertainment and recreation, which added 44,000.

But employment in these industries remains well below their levels from February. Leisure and hospitality is still short 3.5 million jobs; retail is down by about 500,000 jobs. Health care and social assistance, which added 79,000 jobs, is down 950,000 from February. Manufacturing gained 38,000 jobs but remains 621,000 lower than February.

The gains were offset in part by the loss of 268,000 government jobs. The majority, 147,000, were temporary census workers whose employment ended.

Kate Bahn, an economist at the Washington Center for Equitable Growth, said she was concerned that the gains were modest in industries that could be vulnerable as the pandemic results in more layoffs and restrictions.

The snapshot of the country's economic health in October arrives at a portentous moment, in the midst of a national election and a renewed debate of future economic policies, the Post emphasized.

More than 21 million people continue to draw unemployment benefits in what was often compared to the jobless crisis of the Great Depression during the height of the economic shutdown in the spring.

Congress has yet to agree on a way to extend some of the aid programs and eviction protections that many economists credit with propping up the economy during the dire first months of the pandemic. An extra $600 in weekly jobless benefits that helped many stay on top of their bills expired at the end of July.

The number of people who have been unemployed for six months or longer increased by more than 2 million to 3.6 million, the Post said.

The racial and gender disparities in employment that have been exacerbated during the crisis continue to plague policymakers. While the unemployment rate for Whites is 6%, it is 10.8% for Blacks, 7.6% for Asians and 8.8% for Hispanics.

There have been some positive signs in the economy, which has recovered two-thirds of the ground it lost during the first half of the year. Job postings, measured by sites such as Indeed and Glassdoor, have continued to rebound, although they remain well below pre-pandemic levels. Certain retail sectors have shown strength and growth, such as auto parts and dealers, building material and garden stores, and sporting goods and hobby stores.

However, the gains in jobs could further dim the likelihood that Republicans would agree to a large aid package, Senate Majority Leader Mitch McConnell, R-Ky., said. He called the report an indication of a “dramatic comeback” in the economy, and he said he would push for a more limited stimulus because of it.

Other data captures a deep stagnation afflicting the recovery. Homebase, which makes employee-scheduling software, said that the hours employees worked in October were virtually flat compared with September, the fourth straight month of near stagnation. States with cooler weather in the Northeast and Midwest saw steeper declines in the number of businesses open, it said. Data from the Ultimate Kronos Group, another scheduling-software company, had similar results, showing that shift work in the retail, food service and hospitality sectors stayed nearly flat in October.

Federal Reserve Chair Jerome Powell noted Thursday that the economy had recovered more quickly than had been initially forecast, but he also warned about the threats the economy faced from the coronavirus, as well as decreased consumer spending as some households run through their savings in coming weeks and months.

The labor-force participation rate rose slightly to 61.7%, up 0.3 percentage points — but it remains more than a percentage point and a half below its February level. The number of workers who are able to secure only part-time work rose by 383,000, to 6.7 million.

So, we will see. As the “lame duck” session approaches, the policy debates will be as fierce as ever and likely will extend into the spring and beyond, Washington Insider believes.

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