Return to Transcripts main page

CNN Newsroom

New: Omicron Blamed For Big Job Loss In Private Sector; Marty Walsh, U.S. Labor Secretary, Discusses Job Numbers, Economy; Virginia College Community Honors Slain Officers; Beijing Winter Olympic Festivities Begin Amid COVID Concerns. Aired 1:30-2p ET

Aired February 02, 2022 - 13:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(COMMERCIAL BREAK)

[13:34:28]

ANA CABRERA, CNN HOST: A new snapshot of the U.S. economy is emerging today and it shows the weight of Omicron dragging it down.

First, a reminder of the muddled economic picture not all good, not all bad.

There are some encouraging signs. Jobs are coming back. The U.S. economy grew from last year at its fastest pace since 1984. And the markets are still flirting with record highs.

But there's also bad news. The gas prices keep climbing. Inflation in 2021 hit its highest level in 39 years. Interest rates are going up as are housing prices and both rentals and home buying.

[13:35:05]

Bottom line, the economy ran into an Omicron wall and the question is, for how long?

CNN's Matt Egan is here to break it down for us.

Matt, new jobs numbers out this morning just ahead of the big jobs report on Friday. Break down the numbers and what more they tell us.

MATT EGAN, CNN BUSINESS REPORTER: Ana, the jobs market ran into some severe turbulence in January. It really is all about Omicron.

Private employment fell 301,000 in January. That's according to payroll processing firm, ADP. That breaks a streak of 12 monthly gains.

As you can see on that chart, the jobs market was humming along and then Omicron hit and the jobs market went in reverse.

And the impact really was across the board. Almost every sector lost jobs in January.

The biggest losses were in the COVID-sensitive leisure and hospitality sector. That lost 154,000 jobs. That's restaurants, hotels, bars, movie theaters, concert halls.

Trade and transportation lost 62,000. Manufacturing lost 21,000 as well.

And this bleak ADP report is going to raise concerns that the even more important official numbers out on Friday from the government are going to show very weak or even no growth at all for January.

And we've heard White House officials in recent days sort of brace the public for this possibility.

Now the issue here is both the ADP report and the government jobs report, the surveys were taken during the second week in January. And we know cope individual was running rampant at that time. So it makes sense that there's a disruption in the jobs market.

The good news, of course, is COVID cases have declined. And hopefully, that means the impact on the jobs market will be brief.

We also got some developments on the energy price front as well. We heard from OPEC and its allies today and they basically said they are not coming to the rescue of American drivers at this point.

They said they will stick with their plans to raise output by 400,000 barrels per day. They are not going to do anything more aggressive than that.

There had been some speculation on Wall Street in recent days that they might step in here. Because as you can see on the chart, Oil prices are near seven-year highs.

They've complete recovered from that crash in early 2020. They've bounced back from the more recent declines.

And this means higher prices at the pump, which moves with a lag to oil prices. The national average for gasoline hit $3.40 a gallon today. Up about six cents in a week, almost $1 from a year ago.

And it's closing in on the seven-year high that we hit last fall, which was $3.42 a gallon. That could happen at any point.

Ana, there are definitely positives in the economy. Unfortunately, the high cost of living and Omicron are drowning the positives out.

CABRERA: Matt, you have been all over the highs, the lows, the good, the bad for a long time. I encourage our viewers to follow what you write on CNN.com and to follow you on Twitter. Because you break it down and bring us the very latest.

I appreciate it.

Joining us now, Labor Secretary Marty Walsh.

Mr. Secretary, I appreciate your time today.

Today's unemployment report was not good. More than 300,000 jobs lost in January. So much worse than what economists had predicted. They had predicted adding jobs.

So just how bad are you expecting the jobs numbers to be on Friday?

MARTY WALSH, U.S. LABOR SECRETARY: Well, certainly, I don't have a crystal ball but Matt summed it up great -- I couldn't do it any better myself -- when he talks about the Omicron variant and COVID as a whole.

In particular, last month, with the Omicron variant, when Matt talked about that month -- that week of job reports where we get the numbers from, the indexes piece, we had nine million people that had the coronavirus that week, the Omicron variant that we show.

So as we think about this Friday, I'm hopeful we will not be as bad as the private sector jobs. I'm hoping we'll see some gains there.

But, again, the virus has wreaked complete havoc in this country, in this world, for the last two years but, in particular, last month with the gains last year.

And I think it's important to put it in perspective. Last year's gains were 4.6 million jobs throughout the whole year. We had some months that weren't as high as other months. We had some great months and good months.

And we're looking -- as we look forward, President Biden laid out a plan for an economic recovery and responding to go COVID-19 long term. And that's what we'll continue during this coming year. We will continue that plan.

CABRERA: And you are the secretary of labor. You're focused on getting people back to work.

WALSH: Yes.

CABRERA: And yet, the unemployment rate has been dropping. It dropped to 3.9 percent in December. That's close to pre-pandemic levels. It's a level historically considered nearing full employment.

So where is that wiggle room? And how do you, I guess, make sense of there being a worker shortage out there? Where is the disconnect here?

[13:40:05]

WALSH: Well, people have -- (INAUDIBLE) -- right now. Many workers are jumping from employer to employer. They have opportunities to earn more money and make more money so they're jumping from employer to employee.

And you mentioned to me, as secretary of labor, what do we have in our toolbox over here? Job training, workforce involvement in apprenticeship programs.

We're spending a lot of time talking to companies in America, what they're looking for out of employees, what they need to be skilled up in employees. And workers have the power. So if they're working in the job today and making $18 an hour and they have an opportunity to make $25 an hour, they're going to take that.

So we'll be working to help skill people up to help create those opportunities for them.

This is like any other time in our history, as a country, we've never gone through something like this where we're responding to not a recession but we're responding to a global pandemic.

And we have havoc in the workplace. We have concerns. We have people concerned about COVID.

We have people -- even in this Omicron variant, some of the numbers coming in Friday, we have people that are going to be, for lack of a better term, as unemployed.

When in fact, they were working. They were out sick that week but didn't have paid leave so they are deemed as unemployed workers.

So we're working -- you know, as we move forward, proceed on the path of dealing with the virus but also getting people back to work and working with those employers to get people into those industries.

CABRERA: When we look at the total context, I think what you just described is important for our viewers to be prepared in terms of the numbers coming out tomorrow.

You talk about people earning a living wage, wages are rising, and that's good news. Worker compensation rose in December by the most in two decades. But adjusted for inflation, private wages fell by 1.3 percent.

Isn't it true that paychecks are often not keeping up with inflation?

WALSH: In some cases, yes. You know, it's really confusing. And I think for all of us, including myself, the American people are getting lots of information from different sources from the news, from CNN.

And we're talking about, on one side, we have incredible jobs growth for 2021, the lowest unemployment rates since the beginning of the pandemic. We have great GDP growth.

And on the other side, we're dealing with inflation. We're dealing with job quits. We're dealing with a lot of other things.

And I think that we're just living in very turbulent -- maybe turbulent is the wrong word -- but very uncertain times.

I would tell people who are watching today, we're going to get through this.

We'll continue to address -- the president's laser focus on addressing the issues of inflation, laser focused on creating the opportunity for job shortages and also helping people that resigned or who left their job for whatever reason to make sure they're safe in the workplace.

Dealing with the coronavirus, dealing with the vaccines and the boosters and all things moving forward but also moving forward to make sure that our economy continues strong.

The bottom line here, and the president said this from day one, it's about creating opportunities.

When he ran for president, he dealt with coronavirus, he addressed coronavirus, but he also talked about creating pathways into the middle class.

That was one of his purposes around running for president. And his pledges was to create opportunities for the middle class and we can't lose sight of that.

CABRERA: What people need is tangible results.

A new State of the Nation/Gallup poll out just this morning finds that, across 29 different measurements, just 38 percent of Americans are satisfied. That's lower than in 2020. Just 33 percent are satisfied with the state of the economy.

Is there anything you wish you did differently in terms of policy or messaging during the Biden administration's first year?

WALSH: I think part of it is messaging and not just delivering messaging from myself to you but also messaging in the media.

There are lots of different reports out there and people are able to put it in their own context.

Matt, who spoke before me, really summed up in an amazing way of what's happening in the month of January with jobs in America.

He talked about the private sector, about the Omicron variant wreaking havoc. He talked about a lot of different pieces. And the way surveys are being done.

I'm not suggesting we change the survey because I don't think that's the answer.

The answer is, quite honestly, continuing to battle back on the coronavirus and working on, how do we continue to move as a society for the foreseeable future, living in a world of the virus?

And we have 71 percent or 72 percent of Americans fully vaccinated. We have work to do there.

We had great job growth and great opportunities in 2021. But at the end of the day, people still say, wait a second, I might be making more money. The cost of goods are going up. I'm also concerned about my health and my family's health.

There's a lot going on. I think the poll numbers don't reflect President Biden's job approval. I think they reflect where people are right now in their life.

And for President Biden, he is the president, so he has -- we all have to work and deal with that.

CABRERA: Well, it's not just one poll, though. There was a recent Pugh research poll that shows only 28 percent rate the economy as good or excellent.

[13:45:08]

WALSH: Well --

CABRERA: And even among Democrats that number is just 36 percent. The president's own party.

WALSH: No question. There's no question.

And I'm not pushing back on you and this isn't spin. There's a reality of the situation.

And I think we just need to continue to get out there -- when I say we, the administration -- talking about what we're doing to deal with, whether it's getting people back to work or dealing with inflation, all of those things that are talked about every day at the kitchen table.

We need to continue to work on that and we are focused on that.

CABRERA: Labor Secretary Marty Walsh, thank you very much for joining us.

WALSH: Thank you.

CABRERA: Two fallen college campus officers are being remembered today as the Dynamic Duo. What they did to save others at a Virginia college when we come back.

(COMMERCIAL BREAK)

CABRERA: Voices raised in song to honor two fallen officers.

(BEGIN VIDEO CLIP)

(SINGING)

(END VIDEO CLIP)

CABRERA: After yesterday's shooting deaths of Campus Safety Officer J.J. Jefferson and Police Officer John Painter.

They were killed responding to go a call of suspicious man on the grounds. And after a brief search, police tracked down the suspect.

[13:50:07]

The moment he surrendered was caught on video. And let's get to CNN correspondent, Alexandra Field.

What more, Alex, are you leaning about these officers and the suspect?

ALEXANDRA FIELD, CNN CORRESPONDENT: The suspect is a 27-year-old Virginia man, Alexander Campbell. He was, of course, tracked down by law enforcement after wading across a river and then onto an island in that river.

We know law enforcement seized multiple firearms and he is now facing a number of felony charges.

But the focus today really on the lives lost. Two officers who protected a campus killed after several shots were fired on that campus, J.J. Jefferson and John Painter.

Officers who were described by students at Bridgewater as some of the friendliest people on campus. Pillars of the community. And known as a Dynamic Duo, given the closeness of that relationship -- Ana?

CABRERA: Alexandra Field, such a sad story.

Thank you for shining some light.

Only two more days now until the opening ceremony of the Winter Olympics. We will go live to Beijing to see the preparations and the festivities already underway.

(COMMERCIAL BREAK)

CABRERA: We're just two days now from the opening ceremony at the Beijing Winter Olympics.

The festivities, like the ceremonial torch relay, have already started, but it has been shortened a bit to just three days because of COVID concerns.

CNN's David Culver is in Beijing.

Davis, how's it looking there?

[13:55:00]

DAVID CULVER, CNN INTERNATIONAL CORRESPONDENT: Hey there, Ana.

Yes, they're counting down the hours but, unfortunately, counting up the cases. We're starting to see the numbers continuing to climb for folks coming into the Olympic bubble, which is a separate barrier from where we are.

They're kept within a bubble of itself because China itself is a closed loop system. And now they've got this Olympic closed loop system.

So the numbers are going up. And 32 were reported for the incoming folks, the personnel athletes, media. That was reported on Wednesday. And total number roughly 232 who have COVID-19.

Here's what makes this different. We saw that with Tokyo, and people seeing their dreams really just dashed all together, is that this is a zero-COVID society, really.

And that policy is incredibly strict, Ana. They will put you in isolation.

So we're seeing some of these athletes going through the testing and then learning that they are, in fact, positive be put into places that are quite isolating.

One ski jumper from Austria describing this as, "No words, no feelings, just emptiness."

That is, of course, compounded by the extreme isolation they're feeling, too. I mean, it's a heartbreaking situation for many of them.

Compounding all of this, of course, the geopolitics that surround these games. So it's made to be an extremely difficult situation all together -- Ana?

CABRERA: And so much to watch at the upcoming Olympic Games.

David Culver, thank you for your report.

That does it for us today. Thank you for joining us. See you back here tomorrow, same time, same place. Until then, you can join me on Twitter, @AnaCabrera.

The news continues now with Alisyn and Victor after a short break.

(COMMERCIAL BREAK)