Washington(CNN) Republicans argued Friday that the surprising improvement in the jobless rate is evidence more economic stimulus should remain on hold, raising more questions about whether Congress will be able to agree to another recovery package after bipartisan deals led to a historic level of spending to prop up the economy.
GOP leaders have not ruled out more aid -- and acknowledge another bill is probable -- although nowhere in the size or scope Democrats want.
A senior Trump administration official told CNN that after the release of the strong jobs report, Republicans now believe "later in July" will be the "earliest possible window" for the next recovery legislation.
"Republicans generally want to be patient: There's a lot of actual spending left to go out the door; the Fed still has trillions in leverage it can put on the table; and as states reopen, we need to understand what is going on in the economy and what new policies might be called for to best help individuals, families, and businesses. Later in July is the earliest possible window for potential legislative action," the official said.
Democratic leaders urged their GOP counterparts not to be complacent.
"With nearly 20 million people out of work and unemployment among African Americans increasing, now is not the time to be complacent or take a victory lap," Senate Democratic leader Chuck Schumer said in a statement.
"Now is the worst possible moment to take our foot off the gas," said House Speaker Nancy Pelosi, calling for the Senate to approve the more than $3 trillion stimulus bill that House Democrats passed recently.
But the robust jobs report is likely to complicate discussions on Capitol Hill, where lawmakers have engaged in an intense debate over how quickly and when to pass any further stimulus measures, including considering whether to extend federal support for the unemployed.
President Donald Trump took a victory lap Friday morning after news of a 13.3% US unemployment rate. While the numbers still reflect enormous levels of American unemployment, the jobless rate improved from the dramatic 14.7% in April, which was the worst rate since monthly record keeping began in 1948. The US economy added 2.5 million jobs in May, after 20.7 million positions vanished in April.
Republican Sen. Chuck Grassley of Iowa, chairman of the Finance Committee, signaled he's not in a hurry to pass another relief bill. A spokesman for Grassley pointed to the jobs report as a reason Congress should "not rush to pass expensive legislation" responding to the pandemic.
House Democrats have passed a bill that would continue the $600 weekly boost in jobless benefits through early next year. The provision, part of the $2 trillion coronavirus relief package passed at the end of March, currently expires at the end of July.
But Republicans in both chambers are leaning more to providing financial incentives for people to return to their jobs. They are concerned that the augmented unemployment payments create a disincentive for the jobless to go back to work since many people are now collecting more from unemployment benefits than they earned in wages.
Republicans continue discussing ways to address what happens when the additional $600 payment expires at the end of July. Some Republicans have argued that the funding needs to be gradually reduced while other Republicans support a plan to instead incentivize workers to go back to work.
"The jobs report underscores why Congress should take a thoughtful approach and not rush to pass expensive legislation paid for with more debt before gaining a better understanding of the economic condition of the country," said a spokesman for Grassley, who is holding a hearing on the issue on Tuesday.
The Congressional Budget Office released a report this week that shows that roughly five out of six jobless Americans would receive more from unemployment than from working if the $600 weekly supplement were continued through January 31.
Employment would probably be lower in the second half of 2020 and in 2021 than it would be if the boost is not extended, the CBO found. Economic output would probably be greater in the second half of this year than it would be without the extension but would be lower in 2021.
Texas Rep. Kevin Brady, the top Republican on the House Ways and Means Committee, introduced a bill this week that would allow workers to keep up to two weeks of supplemental federal benefit after accepting a job, comparing it to a $1,200 hiring bonus. It would be available until July 31.
The proposal is similar to one being floated by Republican Sen. Rob Portman of Ohio that would provide $450 a week to those returning to work through the end of July. White House economic advisers have also discussed incentives to draw people back to their jobs.
The continued decline in state and local employment, however, may bolster governors' and mayors' pleas for more federal aid from Congress. State and local officials are facing massive tax revenue shortfalls and budget gaps that will not be reversed quickly. Many have warned that they will have to lay off more public workers to balance their budgets by July 1, when the next fiscal year starts in most states.
Republican Sen. Marco Rubio released a statement on Friday arguing that the unemployment numbers show that one of the stimulus measures Congress has already enacted -- the Paycheck Protection Program -- is working, and did not call for further action.
"While far too many Americans remain out of work, it is clear the economic situation for tens of millions of workers and millions of small businesses would be far worse without the Paycheck Protection Program," the Florida Republican said.
The conflicting messages from Senate Democrats and Republicans in response to the jobs numbers underscore the deep divide in the Senate over further stimulus measures in the wake of congressional action to pass trillions of dollars of stimulus legislation earlier this year in response to the pandemic.
Earlier this week, Sen. Roy Blunt of Missouri, a member of Senate GOP leadership, said the Senate is not likely to move ahead with another recovery package in June and will likely wait until July to act to see what the economy needs.
"My personal belief is we will do something before the August break -- that's about the right the timing," he said.