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Jobs report: ‘All of the sectors’ back to pre-pandemic levels, Labor Secretary says

U.S. Labor Secretary Marty Walsh speaks with Yahoo Finance Live about the July jobs report, manufacturing labor gains, and the Inflation Reduction Act.

Video Transcript

JULIE HYMAN: But for now, we've got to refocus on this jobs report because as we've been talking about, the US added a stunning 528,000 jobs in July, exceeding estimates of 250,000. Joining us now for a deeper dive on the labor market is US Labor Secretary Marty Walsh, who talks to us, as he always does, after the jobs report.

This is a particularly good one though, to talk to you about, Mr. Secretary. So talk to us about where we are seeing this strength, what you are hearing from corporate leaders because we just are getting through earnings season. There's a lot of trepidation out there that doesn't seem to square with this big number.

MARTY WALSH: Well, I'll tell you, this is probably one of the best interviews I want to do today because the 526,000 jobs overestimation is great. But more importantly, when you look at the picture as a whole, we're seeing all the sectors have come back to pre-pandemic. The unemployment rate is actually a little lower today than it was the day before the pandemic hit in the United States, which we had a pretty strong economy back then.

We're seeing great gains in manufacturing. Manufacturing is not only back, but we're exceeding where we were. And then when you think about the CHIPS Bill that the president's going to be signing hopefully next week, we're going to see more manufacturing happen in the United States of America on semiconductors. And long-term, that will help us in inflationary pressures, being less dependent on foreign imports coming into the country.

We saw gains in education. I think part of that was-- what I would assess that as is, last year this time, schools around America in cities and towns weren't hiring as often, as much because they weren't sure what the school year was going to bring. Now there's a lot more predictability. People have learned how to live with the pandemic, live with the virus. There are safety precautions in schools. And schools are staffing up across the country. We're seeing all of that.

And then obviously, we still know-- you talked about gas prices. We've seen a decline for seven straight weeks in a row. It's the largest decline in the last decade. But still, people are looking for more return back into their pocket. So the president released some oil reserves. And also working right now with Congress to pass the Inflation Reduction Act that's quite honestly being debated in the Senate right now as we speak. Well, not right now, but they're talking about it behind the scenes. They're going to have a debate, I think, in the next couple of days, hopefully.

BRIAN SOZZI: Mr. Secretary, is this report, the jobs report so strong today that we just need to bury once and for all that the economy is headed to a recession?

MARTY WALSH: Yeah. I don't want to say it's not. And I don't want to say it is because I personally don't think it is. I think that when you talk to companies, when I go around America and I talk to businesses and companies, they're hiring. They're looking to expand. They're looking to grow.

Last year we saw 5.2 million people start their own business, entrepreneurship. Some of those companies are still in existence today. And they're going to grow. And I think we need to continue to focus on making investments in supporting American businesses to continue to grow whether that's in the manufacturing sector, the retail sector, the leisure and hospitality sector and these other sectors that we have in the country, the high-tech sector, the biotech sector, all these different sectors we have. I,

Think these companies want to continue to grow. And I think one thing-- I was on a call this morning. And I said, I kind of look at this through my lens of being my old job. I don't look at it as being the secretary of labor. And I think about cities and towns all across America. And governors and states want to continue to grow. And I think we just have to continue to focus on that and do everything we can to reduce inflation.

I think the president laid out a plan two years ago to get America back to work. 10 million Americans almost have gone back to work under his tenure. Last year, he laid out a plan to deal with inflation. We're working on bringing those costs down, those pressures down.

This administration, the Biden administration did not cause the inflationary pressures we have. We can't lose sight that a lot of it was because of a pandemic and global supply chains and issues around the globe and the desires for people wanting things. So we're going to continue to move forward. And hopefully in the next several months, we'll be on this call talking about our inflation coming down and our economy continue to be very strong.

JULIE HYMAN: Fingers crossed, for sure. I want to ask you about another phenomenon and whether you are hearing about this in your travels and in your discussions with CEOs. And that's something we've begun to talk about, which in past, as companies prepared for inflations-- for inflations-- for recessions in the past-- excuse me-- they started cutting pretty quickly and pretty broadly. That's not necessarily what we're seeing this time.

We're hearing from companies maybe they're slowing hiring. Maybe they're doing targeted cutting because they don't think, if there is a downturn, that it will be that severe. Is that what you're hearing from people as well, they're reluctant to lay off people?

MARTY WALSH: YEAH, well, when I'm talking to businesses all across the country, they're just talking about, there could be a recession looming. But also, like you just said, they're adding to the bottom line. They're continuing to grow. They're continuing to add people on.

I guess some of the bigger companies are slowing down a little bit in hiring. But when you look at 500,000-plus jobs being added in one month, the slowdown is very incremental, obviously. But there's still other areas for growth. So I think what everyone's kind of-- in the business community and in the world is a wait-and-see approach to see how we move forward and what's happening.

Again, this is a very different time that we're living in. I was a legislator in the last couple of downturns where we actually had recessions where we had to raise taxes and cut benefits and cut programs. That doesn't have the same feel as right now.

BRIAN SOZZI: We'll leave it there. US Labor Secretary Marty Walsh, always good to get some time with you. Have a great weekend.

MARTY WALSH: Thank you.