A Nobel Prize-winning economist is warning that Friday's seemingly encouraging job report is actually alarming. This is why.

Friday morning's stunning job report is already being celebrated by the White House as unemployment unexpectedly fell to 13.3 percent in May. But even as forecasters have scrambled to understand how their predictions were so far off, Nobel Prize-winning economist Paul Krugman stressed on Twitter that "whatever happened, these numbers should make you more, not less, pessimistic about the economic outlook."

Huh? As Krugman goes on to explain, the seemingly encouraging job report could actually "reinforce the White House inclination to do nothing and let emergency aid expire."

That's alarming to Krugman and other analysts because what May's job numbers do seem to prove is that the Payroll Protection Program, which encouraged small businesses to keep workers on payroll during the pandemic, was instrumental in helping bring back workers in May. "U.S. unemployment [is] at 13 percent [with] trillions in government aids," wrote The Washington Post's Jeffrey Stein. "What happens when huge infusion runs dry in July?"

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

But as of Thursday night, the Post was reporting that President Trump's recovery plan "largely amounts to optimism that as pandemic restrictions are loosened, the nation's economy will turn the lights back on by itself." As the Post goes on to explain, Trump is hesitant to offer states further aid, and opposes extending the soon-to-expire $600 unemployment bonus for laid-off workers.

White House economic adviser Stephen Moore seemed to confirm Krugman's fears. "There's no reason to have a major spending bill," he said in response to Friday's job numbers. "The sense of urgent crisis is very greatly dissipated by the report."

Not everyone shares the opinion that the job report lets the federal government off the hook. "The jobless rate, even if it declines, I believe is going to stay extremely high through the end of the year," former Federal Reserve chair Janet Yellen told the Post. "It's absolutely essential to have another package that will extend unemployment benefits beyond the summer. That's going to be tremendously needed."