Tag Archives: President Joe Biden

Biden, Putin to meet in Geneva on June 16 amid disagreements

By Nandita Bose and Arshad Mohammed

WASHINGTON (Reuters) -U.S. President Joe Biden and Russian President Vladimir Putin will meet in Geneva on June 16, the White House and the Kremlin said on Tuesday amid sharp disputes over election interference, cyberattacks, human rights and Ukraine.

Earlier this month, Reuters reported that both countries were lowering expectations for breakthroughs at the superpower summit, with neither in a mood to make concessions on their disagreements.

“The leaders will discuss the full range of pressing issues, as we seek to restore predictability and stability to the U.S.-Russia relationship,” White House Press Secretary Jen Psaki said on Tuesday.

The Kremlin said in a statement that the two leaders would discuss bilateral ties, problems related to strategic nuclear stability, and other issues including cooperation in the fight against COVID-19 and regional conflicts.

Biden has previously said he wants Putin to stop trying to influence U.S. elections, stop cyberattacks on U.S. networks emanating from Russia, stop threatening Ukraine’s sovereignty and release jailed Kremlin critic Alexei Navalny.

The White House has avoided describing Biden as seeking a “reset” in relations with Putin, a term often used by former U.S. presidents as they seek to improve relations with Russia.

Rather, U.S. officials see the face-to-face meeting as an opportunity to tilt the relationship away from what they view as former President Donald Trump’s fawning overtures to Putin.

Russian officials told Reuters they regard the summit as an opportunity to hear from Biden directly after what a source close to the Russian government said were mixed messages from the U.S. administration that took office on Jan. 20.

Putin views U.S. pressure over Navalny and its support for pro-democracy activists in Russia and Belarus as tantamount to interfering in Russian domestic affairs.

Russia is also unhappy about U.S. sanctions, including those announced on April 15 that included curbs to the Russian sovereign debt market to punish Moscow for interfering in the 2020 U.S. election, cyber hacking, bullying Ukraine and other alleged malign actions which Russia denies.

The U.S. government blacklisted Russian companies, expelled Russian diplomats and barred U.S. banks from buying sovereign bonds from Russia’s central bank, national wealth fund and Finance Ministry. The United States warned Russia that more penalties were possible but said it did not want to escalate.

Russia denies meddling in U.S. elections, orchestrating a cyber hack that used U.S. tech company SolarWinds Corp SWI.N to penetrate U.S. government networks and employing a nerve agent to poison Navalny, who is imprisoned on charges he says are politically motivated.

Biden has also voiced concerns about the buildup of Russian forces in Crimea, which Russia seized from Ukraine in March 2014, and along the border with Ukraine, which have raised U.S. worries about a possible invasion.

Another topic likely to come up is Western outrage at Belarus, which scrambled a fighter and forced a Ryanair plane to land on Sunday in Minsk, where authorities arrested a Belarusian dissident journalist aboard the plane.

Russia has denied reports four of its citizens got off the plane in Minsk, which sparked suspicions of Russian involvement.

(Reporting by Susan Heavey and Nandita Bose; Writing by Arshad Mohammed; Editing by Doina Chiacu and Howard Goller)

Biden looks abroad for electric vehicle metals, in blow to U.S. miners

By Ernest Scheyder and Trevor Hunnicutt

(Reuters) – U.S. President Joe Biden will rely on ally countries to supply the bulk of the metals needed to build electric vehicles and focus on processing them domestically into battery parts, part of a strategy designed to placate environmentalists, two administration officials with direct knowledge told Reuters.

The plans will be a blow to U.S. miners who had hoped Biden would rely primarily on domestically sourced metals, as his campaign had signaled last autumn, to help fulfill his ambitions for a less carbon-intensive economy.

Rather than focus on permitting more U.S. mines, Biden’s team is more focused on creating jobs that process minerals domestically into electric vehicle (EV) battery parts, according to the people.

Such a plan would help cut U.S. reliance on industry leader China for EV materials while also enticing unions with manufacturing work and, in theory, reduce pandemic-fueled unemployment.

The U.S. Commerce Department is organizing a June conference to attract more EV manufacturing to the country. Biden’s proposed $1.7 trillion infrastructure plan earmarks $174 billion to boost the domestic EV market with tax credits and grants for battery manufacturers, among other incentives. The department declined to comment.

“It’s not that hard to dig a hole. What’s hard is getting that stuff out and getting it to processing facilities. That’s what the U.S. government is focused on,” said one of the sources.

The approach would see the United States rely on Canada, Australia, and Brazil – among others – to produce most of the critical raw materials needed, while it competes for higher-value jobs turning those minerals into computer chips and batteries, according to the two sources.

Securing the full supply chain from metals to batteries does not require the United States to be the primary producer of the raw materials, said one of the sources.

A full strategy will be finalized after a year-long supply chain review involving national security and economic development officials.

Biden officials want to ensure the administration’s EV aspirations are not imperiled as domestic mines face roadblocks, the sources said, both from environmentalists and even some Democrats.

“It rings hollow when I hear everyone use this as a national defense argument, that we have to build new mines to have a greener economy,” said U.S. Representative Betty McCollum, a Democrat who has introduced legislation that would permanently block Antofagasta Plc’s proposed Twin Metals copper mine in Minnesota.

Ali Zaidi, deputy White House national climate advisor, said the administration was focused on a strategy that “leverages our domestic resources in a way that’s responsible”, noting that included recycling in the supply chain.

While U.S. projects from small and large miners alike will feel the impact, the pain from any blocked projects will fall disproportionately on smaller, U.S.-focused companies. Many large miners also have global projects that could benefit from the administration’s plan.

“We can no longer push the production of the products we want to places we cannot see and to people we will never meet,” said Mckinsey Lyon of Perpetua Resources Corp, which is trying to develop Idaho’s Stibnite mine to produce gold and antimony used to make EV battery alloys.

INVESTMENTS

The U.S. government in April became the largest shareholder in mining investment firm TechMet, which controls a Brazilian nickel project, a Rwandan tungsten mine and is a major investor in a Canadian battery recycler.

Washington also funds research into Canadian cobalt projects and rare earths projects in Malawi, among other international investments.

The State Department’s Energy Resource Governance Initiative (ERGI) is one of the main programs Washington plans to use to help allies discover and develop lithium, cobalt and other EV metals. To be sure, Washington is not ignoring domestic mining.

The U.S. Department of Energy has awarded grants to help old coal mines find ways to produce rare earths. U.S. officials have also funded MP Materials Corp, which owns the country’s only rare earths mine, though it relies on Chinese processors.

But the bulk of Biden’s approach is designed to sidestep battles with environmentalists and save capital for other fights, according to one administration source. During a visit to a Ford Motor Co plant in Michigan on May 18, Biden called for government grants for new EV battery facilities. He mentioned Australia’s lithium reserves during the tour, but not large U.S. supplies of the key battery mineral.

Republicans say Biden’s EV plans will be impossible to achieve without more U.S. mines.

“These ‘not-in-my-backyard’ extremists have made clear they want to lock up our land and prevent the mining of minerals,” U.S. Representative Lauren Boebert, a Colorado Republican, told a House Natural Resources Committee forum held the same day as Biden’s Michigan visit.

PLACATING LABOR

Biden’s approach comes with risks, including angering political supporters within the labor movement who want the administration to have an openness to resource extraction and the attendant jobs.

“Let’s let Americans extract these minerals from the earth,” said Aaron Butler of United Association Local 469 union, which does work for Rio Tinto Ltd’s proposed Resolution copper mine project in Arizona and endorsed Biden in the elections. “These are good-paying jobs.” Many of the skills that labor unions would use to build mines, including concrete and electrical work, can also be used to build EV metal processing plants.

The National Mining Association, an industry trade group, has been lobbying the White House and Congress to support domestic projects, arguing that the coronavirus pandemic showed the importance of localizing supply chains.

Biden’s White House is now quietly working to enlist labor support as it tries to build a case that its green policies are creating jobs, ahead of the 2022 midterm elections that could determine whether the strategy wins congressional backing, according to two organized labor sources familiar with the campaign Biden officials have reached out to unions across the country asking for specific job-boosting projects the administration can take credit for, the labor sources said.

(Reporting by Ernest Scheyder in Houston and Trevor Hunnicutt in Washington; Editing by Amran Abocar and Marguerita Choy)

U.S. plays down prospect of North Korea initiative at Moon summit

By David Brunnstrom and Jarrett Renshaw

WASHINGTON (Reuters) -South Korean President Moon Jae-in has been hoping to use his first summit with U.S. President Joe Biden this week to press a legacy policy of engaging North Korea, but Washington has played down the prospect of any quick impetus on the issue.

In their meeting on Friday, Biden is set to prioritize boosting cooperation with Seoul on regional security more broadly – notably in response to the challenge posed by China – in high-tech industries such as microchips, the coronavirus pandemic and advancing policy on climate change.

South Korean officials were heartened by Biden’s North Korea policy review, which called for a focus on practical diplomatic steps to reduce tensions while maintaining a final goal of persuading Pyongyang to give up its nuclear weapons.

But the pandemic, economic and political challenges, and crises elsewhere have shifted the North Korea issue towards a rear burner, complicating Moon’s hopes of cementing a peacemaker legacy before leaving office next year.

In a move analysts say appeared a sop to Moon, Biden’s Asia policy coordinator Kurt Campbell spoke in an interview with South Korea’s Yonhap news agency this week of building on past agreements with North Korea, including one reached in Singapore by Biden’s predecessor Donald Trump.

That agreement with North Korean leader Kim Jong Un pledged joint efforts to build a peace regime to end seven decades of hostility on the Korean peninsula, something Moon has energetically pursued.

But the White House has declined to offer specifics of incentives it might offer to entice North Korea back to talks.

“At this juncture, it’s really not in our interest to preview or comment on specific issues like an end-of-war declaration in hopes of spurring dialogue,” a senior administration official told reporters.

“But you can expect that a significant amount of the upcoming visit will be spent discussing the challenges of (North Korea) and how our two countries can move forward together in dialogue.”

The official said Moon, who arrived in Washington on Wednesday evening, was accompanied by CEOs bringing investments in technology and batteries, high-tech semiconductors, issues associated with 5G and new-age logic chips.

The Financial Times quoted sources familiar with the talks as saying Washington was trying to convince Moon to agree a strong statement of concern about China, but Seoul has been reluctant for fear of angering Beijing, a key trading partner.

Asked if he expected Moon to agree a joint statement of about Chinese activity towards Taiwan, the senior U.S. official replied: “I believe there will be a reference to regional security generally and to issues in the maintenance of peace and stability, specifically, yes.”

The two governments “see eye-to-eye” on many of the challenges in the Indo-Pacific, he said.

On Thursday, Moon visited Arlington National Cemetery just outside Washington and laid a wreath at a memorial to Americans killed during the 1950-53 Korean War, a report from the Press pool traveling with him said. In the afternoon, Moon will visit Capitol Hill to meet U.S. House Speaker Nancy Pelosi, a Democratic ally of Biden.

PRESSURE ON CLIMATE TARGETS

South Korea has set a target of reducing carbon emissions by 24.4% from the 2017 level by 2030 as part of its commitment under the Paris Agreement, but White House global climate policy official John Kerry has been pushing Seoul to double the target.

The senior administration official said Washington was working with allies like South Korea to decarbonize their power and transportation sectors and seek shared enhanced commitments and ambitions for 2030. “I think we’ll have more to report on this on Friday,” he said.

Moon, facing dwindling popularity over the pandemic, is under pressure to secure more and faster deliveries of U.S.-made vaccines. He has promised to secure a vaccine partnership at the summit by harnessing South Korea’s biotech production capacity.

In his meeting with Pelosi, Moon was expected to request congressional support for the Korea peace process and Seoul’s bid to emerge as a global vaccine production hub, according to the pool report on the South Korean news agency Yonhap. Campbell told Yonhap Moon and Biden would discuss how the United States supports Seoul’s fight against COVID-19 and ways to jointly boost global vaccine production.

He said summit outcomes would include “tangible partnerships related to addressing supply-chain security and enhancing public and private cooperation on advanced technology.”

On Thursday, Ford Motor Co and South Korean battery maker SK Innovation announced they would form a joint venture in North America to support the No. 2 U.S. automaker’s electric vehicle rollout.

And South Korea’s Samsung Electronics Co Ltd could begin construction of a planned $17 billion U.S. chip plant in the third quarter of this year, a South Korean newspaper reported on Monday.

(Reporting by Jarrett Renshaw, David Brunnstrom and Steve Holland; editing by Mary Milliken)

Putin threatens to ‘knock out the teeth’ of foreign aggressors

MOSCOW (Reuters) – President Vladimir Putin said on Thursday that Moscow would “knock out the teeth” of any power that tried to take a chunk of Russia’s territory.

The Russian leader, in televised remarks during a virtual meeting with senior officials, cited what he said were foreign remarks questioning Russia’s control of energy-rich Siberia.

A similar comment has been attributed in Russia to a former U.S. secretary of state, Madeleine Albright, although she has denied making it.

“Some even dare to say publicly that it is allegedly unfair that Russia owns the wealth of a region such as Siberia. Only one country does,” said Putin.

Using combative language that appeals to his power base among the armed and security forces, Putin said Moscow would give a blunt and forceful response to any would-be aggressors.

“Everyone wants to ‘bite’ us somewhere or ‘bite off’ something of ours, but those that would do this should know that we will knock out the teeth of all of them so they aren’t able to bite… And the key to this is the development of our armed forces,” he said.

The comments come amid a push to agree a summit between Putin and U.S. President Joe Biden aimed at preventing Moscow’s dire relations with Washington sliding further.

(Reporting by Tom Balmforth; editing by Jonathan Oatis)

Biden to send 20 million doses of U.S.-authorized vaccines abroad for first time

By Steve Holland

WASHINGTON (Reuters) -President Joe Biden will send at least 20 million more COVID-19 vaccine doses abroad by the end of June, marking the first time the United States is sharing vaccines authorized for domestic use.

The move marks a notable pivot from the White House as the administration seeks to use the country’s vaccine supply as a diplomatic tool with the pandemic outlook brightening at home.

Biden announced on Monday that his administration will send doses of the Pfizer Inc/BioNTech SE, Moderna Inc and Johnson & Johnson vaccines, on top of 60 million AstraZeneca Plc doses he had already planned to give to other countries.

Unlike the others, AstraZeneca’s shot is not yet authorized for use in the United States.

“Just as in World War Two America was the arsenal of democracy, in the battle against COVID-19 pandemic our nation is going to be the arsenal of vaccines,” Biden said.

The president has been under pressure to share vaccines to help contain worsening epidemics from India to Brazil, where health experts fear new, more contagious coronavirus variants could undermine the effectiveness of available shots.

Biden noted that no other country will send more vaccines abroad than the United States. So far, the United Stages has sent a few million AstraZeneca doses to Canada and Mexico.

“We want to lead the world with our values with this demonstration of our innovation, ingenuity, and the fundamental decency of American people,” Biden said.

The White House has not provided any details about what countries will receive the shots. Biden said that Jeff Zients, who heads the U.S. vaccine efforts, will now also lead the global vaccine push.

The United States has administered more than 272 million COVID-19 vaccine doses and distributed more than 340 million, according to federal data updated on Monday morning.

With more and more Americans vaccinated, U.S. deaths from COVID-19 last week fell to their lowest in nearly 14 months, while the number of new cases declined for a fifth consecutive week, according to a Reuters analysis of state and county data.

Biden warned that those who do not get vaccinated “will end up paying the price” as he lamented that “we’re still losing too many Americans” despite the significant progress.

(Reporting By Steve Holland, Carl O’Donnell and Jarrett Renshaw; Writing by Jarrett Renshaw; Editing by Trevor Hunnicutt and Bill Berkrot)

U.S. to bolster public health workforce to fight COVID-19, future pandemics

WASHINGTON (Reuters) – The Biden administration is releasing $7.4 billion to bolster the nation’s healthcare workforce amid the ongoing COVID-19 pandemic and to prepare for future epidemics and health challenges, the White House said in a statement on Thursday.

The funds, allocated as part of the $1.9 trillion aid package pushed by President Joe Biden and passed by Congress in March, will be used to recruit and hire a range of healthcare workers to help with vaccinations, testing and contact tracing, it said.

Of the $7.4 billion, $4.4 billion will go to states and local public health departments to address disease outbreaks and hire school nurses. It will also be used to expand the U.S. Centers for Disease Control and Prevention’s ability to track outbreaks and to create a service corps dedicated to public health. The remaining $3 billion will boost local public health workforces ahead of future challenges, with an emphasis on recruiting diverse candidates, the White House said.

The United States is making progress in its efforts to emerge from the coronavirus pandemic, which shut down much of the country last year and roiled the economy, with more than 582,000 deaths to date.

After a winter spike in COVID-19 infections, new cases have fallen for four straight weeks and deaths have also dropped as more than one-third of the country has been vaccinated. Warmer weather has also helped to curtain the spread of the virus.

Nearly 154 million people in the United States had received at least one dose of a COVID-19 vaccine as of Wednesday, U.S. officials said. The pace of vaccinations, however, has slowed and U.S. health officials have said variants such as the one emerging from India could still pose a threat.

Public health experts for years have decried a lack of funding for the CDC and other areas and have warned about the potential devastating impact from epidemics of SARS, Ebola, swine flu and other diseases.

(Reporting by Steve Holland and Susan Heavey; Editing by Paul Simao)

America’s mask makers face post-pandemic meltdown

By Timothy Aeppel

(Reuters) – The small U.S. manufacturers that rushed to produce face masks over the past year are now stuck with hundreds of millions of unsold face coverings because China is flooding the market with below-cost masks, and most may not survive the end of the pandemic.

That’s the thrust of a letter to President Joe Biden released Tuesday by a trade group representing 26 small manufacturers that set up production of the badly needed safety items as the health crisis took hold last year.

The manufacturers said over half their production would be forced offline in 60 days if they don’t get immediate federal aid, costing thousands of jobs. They blame low-priced imports, especially from China.

“We write to you with a request for immediate help against unfair trade practices by foreign nations that threaten the viability of the U.S. domestic PPE mask manufacturing industry, as well as future U.S. pandemic preparedness efforts,” the newly formed group, the American Mask Manufacturer’s Association, said in the letter.

The group said they have capacity to produce 3.7 billion surgical masks and more than 1 billion of the higher-protection N95 masks a year – and are now sitting on stockpiles of 260 million surgical masks in their warehouses that they are struggling to sell. Another 20 million N95s are also on factory shelves.

When masks were in short supply last year, prices surged. But prices have now crashed, and hospital administrators and others are shopping for the best prices in a market crowded with new offerings.

A box of 50 surgical masks which sold for more than $50 a year ago can be found for $5 now.

The trade group said while there are 3 to 6 cents in raw material in every surgical mask, imported Chinese surgical masks now sell for an average of 1 cent each. “China … is effectively dumping masks on the U.S. market at well below actual costs.”

“If this remains unchanged, 54% of our production will go offline in 60 days and 84.6% in less than a year,” the group said in the letter. The group said they’d created more than 7,800 U.S. jobs in the last year, but roughly a third of those have already been lost to production cuts.

PROTECTING PRODUCERS

The Biden administration has pledged to look at ways to support domestic producers of protective equipment – including potentially finding ways to subsidize U.S. producers – but the government reviews are still underway.

“The idea that everyone expressed during the crisis – that we need to avoid (PPE shortages) ever happening again – hasn’t changed profit-driven institutions,” said James Wyner, chief executive of Shawmut Corp., a West Bridgewater, Massachusetts, maker of engineered materials that expanded into mask production during the crisis. “The distributors are still sourcing their stuff at the lowest price.”

Wyner said he’s selling masks from his new production lines, but “substantially less than we would like.”

Adam Albrecht, senior quality control manager at Indiana Face Mask, another small producer, said when the firm first started producing the higher-filtration N95 masks last year, “People came out of the woodwork, saying: ‘We can sell this, we can sell this.’ But it seems no matter how much we adjust prices down, the Chinese stay just below.”

Some of the small mask makers are confident they will survive.

Dan Izhaky, who together with a partner has invested $4 million in a new mask factory outside Los Angeles, said the challenge is greater for makers of surgical masks, the ubiquitous safety masks that are relatively easy to make. Izhaky’s company makes more complex N95 masks and he said he has continued to expand. “But we also believe the Biden administration is going to take a number of steps down the road to really help us be sustainable,” he said.

The mask trade group – which doesn’t include industry giants such as 3M Co. and Honeywell International Inc. – urged the Biden administration to take immediate action to support the industry.

Their recommendations include requiring the federal government and any other institution receiving federal dollars for buying protective equipment to buy only U.S.-made masks that comply with government rules on domestic content and remove any masks in the federal stockpile that don’t meet federal standards. They also want the administration to require any hospital that accepts federal funds to earmark 40% of its spending on PPE for domestic producers by 2023.

They are also asking the government to consider buying the 260 million masks now stockpiled at the new factories.

(Reporting by Timothy Aeppel; Editing by Dan Burns and Andrea Ricci)

Biden says unemployed offered jobs must take them or lose benefits

By Nandita Bose

WASHINGTON (Reuters) -U.S. President Joe Biden on Monday defended himself against critics who say expanded unemployment benefits offered in the COVID-19 relief bill passed in March are keeping Americans from taking new jobs.

Biden said the administration will remind U.S. states this week that any unemployed American offered a comparable job must take it or risk losing unemployment benefits. He is also directing the U.S. Labor Department to work with states to reinstate requirements that those receiving unemployment benefits must demonstrate they are actively looking for work.

“If you’re receiving unemployment benefits and you’re offered a suitable job, you can’t refuse that job and just keep getting unemployment benefits,” Biden said.

Republican lawmakers blamed a bad jobs report last week on the Democratic president’s decision to offer expanded unemployment benefits through August. Some Republican governors have scrapped the added benefits, directing the additional dollars elsewhere.

(Reporting By Nandita Bose and Jarrett RenshawEditing by Chizu Nomiyama and Howard Goller)

Biden: Jobs report shows “long way to go” in economic recovery

By Jeff Mason and Steve Holland

WASHINGTON (Reuters) -President Joe Biden on Friday predicted a “long way to go” for U.S. economic recovery from a pandemic-spurred slump and urged Washington to do more to help the American people after a disappointing jobs report.

U.S. job growth unexpectedly slowed in April, likely restrained by shortages of workers and raw materials.

Biden and his team have said his $1.9 trillion pandemic relief package, the Democratic president’s first major legislative accomplishment, is helping to bring the economy back from its pandemic plummet.

“Today’s report just underscores in my view how vital the actions we’re taking are,” Biden said in remarks at the White House. “Our efforts are starting to work. But the climb is steep and we still have a long way to go.”

The White House is pressing for trillions of dollars more in spending on infrastructure, education and other priorities. Republicans, however, object to the high price tag of Biden’s initiatives and critics have raised concerns about inflation and a disincentive, thanks to generous unemployment benefits, for people to return to the workforce.

The White House dismissed that criticism on Friday. Biden said he had not seen evidence that enhanced unemployment benefits were putting a drag on employment figures.

Jared Bernstein, a member of the president’s Council of Economic Advisers, told Reuters Biden’s COVID relief and stimulus package, known as the American Rescue Plan, had helped generate an average of more than half a million jobs per month over the last three months, April notwithstanding.

“Those are big numbers, and the fingerprints of the American Rescue Plan are all over those additions,” he said.

Bernstein said no course correction was required from the White House, a theme echoed by Nancy Pelosi, the Democratic speaker of the House of Representatives, who pressed for passage of Biden’s next legislative push.

“The disappointing April jobs report highlights the urgent need to pass President Biden’s American Jobs and Families Plans,” she said in a statement. “We need to take bold action to Build Back Better from this crisis by investing in our nation, our workers and our families.”

Republicans viewed it differently.

“Why is anyone surprised that the jobs reports fell short of expectations?,” said Republican Senator Marco Rubio of Florida on Twitter. “I told you weeks ago that in #Florida I hear from #smallbusinesses every day that they can’t hire people because the government is having them not go back to work.”

The share of Americans who are either working or looking for work rose last month, and the number of people who said they are not looking for jobs because of COVID-19 fell by 900,000 in April, Bernstein said, pushing back against criticism from some employers that the benefits had kept some people from returning to the workplace.

“Thus far, we don’t see a correlation between unemployment insurance benefits and lack of employment,” he said.

“What we do see is a lot of people who are still hesitant to go back to work because of safety concerns, care issues, schooling issues, and we’ll continue to watch this very closely.”

(Reporting By Jeff Mason and Steve Holland; additional reporting by Jonnelle Marte and Merdie Nzanga; Editing by Chizu Nomiyama, Andrea Ricci, William Maclean)

U.S. job growth far below expectations in April amid labor shortages

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. employers hired far fewer workers than expected in April, likely frustrated by labor shortages, leaving them scrambling to meet booming demand as the economy reopens amid rapidly improving public health and massive financial help from the government.

Nonfarm payrolls increased by only 266,000 jobs last month after rising by 770,000 in March, the Labor Department said in its closely watched employment report on Friday.

Economists polled by Reuters had forecast payrolls advancing by 978,000 jobs.

The jobs report, the first since the White House’s $1.9 trillion COVID-19 pandemic rescue package was approved in March, will probably do little to change expectations that the economy entered the second quarter with strong momentum and was on track for its best performance this year in almost four decades.

Twelve months ago, the economy purged a record 20.679 million jobs as it reeled from mandatory closures of nonessential businesses to slow the first wave of COVID-19 infections. New claims for unemployment benefits have dropped below 500,000 for the first-time since the pandemic started.

Americans over the age of 16 are now eligible to receive the COVID-19 vaccine, leading states like New York, New Jersey and Connecticut to lift most of their coronavirus capacity restrictions on businesses.

But the resulting burst in demand, which contributed to the economy’s 6.4% annualized growth pace in the first quarter, the second-fastest since the third quarter of 2003, has triggered shortages of labor and raw materials.

From manufacturing to restaurants, employers are scrambling for workers. A range of factors, including parents still at home caring for children, coronavirus-related retirements and generous unemployment checks, are blamed for the labor shortages. The moderate pace of hiring could last at least until September when the enhanced unemployment benefits run out.

The labor market remains supported by very accommodative fiscal and monetary policy. President Joe Biden plans to spend another $4 trillion on education and childcare, middle- and low-income families, infrastructure and jobs. The Federal Reserve has signaled it intends to leave its benchmark interest rate near zero and continue to pump money into the economy through bond purchases for a while.

The unemployment rate rose to 6.1% in April from 6.0% in March. The jobless rate has been understated by people misclassifying themselves as being “employed but absent from work.” Millions of Americans remain out of work and many have permanently lost jobs because of the pandemic.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama)