On Friday’s broadcast of CNN’s “At This Hour,” New York Times Federal Reserve and Economy Reporter Jeanna Smialek said that “the supply of workers just isn’t going to be the thing” that returns the labor market to balance and so, “what you’re going to have to rely on is employers wanting to hire less and that putting that back into balance.”
Smialek said, “We just really haven’t seen a huge number of people pour back into the labor market. I think some of the early retirements that happened during the pandemic, people were hoping those folks might come back from the sidelines. I think some of the mothers who dropped out of the labor market to take care of children, people thought they might come back. We’re just not seeing that happen at rapid pace. And so, I think what that means is that the supply of workers just isn’t going to be the thing that gets sort of the labor market back into balance. We’re really going to have to stop demand for workers. So, what we see right now is a labor market where there are almost two open jobs for every unemployed person who’s actively applying to work. And that’s obviously very out of whack. It’s very elevated relative to normal. The hope was, you might get workers coming back in and sort of putting that back to rights. And I think, instead, what you’re going to have to rely on is employers wanting to hire less and that putting that back into balance. And unfortunately, that’s probably a more painful situation, if you have to slow down demand for workers than if the workers just came back on their own.”
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