Yellen Sees U.S. Labor Market Being Back on Track by Next Year

U.S. Treasury Secretary Janet Yellen said the Biden administration is working toward getting the labor market “back on track” by later this year or early in 2022.

“We’re really concerned about scarring permanent scarring from this crisis, and it’s focused us very heavily on doing everything we can to get back on track as quickly as we can,” Yellen said in a virtual discussion with International Monetary Fund Managing Director Kristalina Georgieva Monday. “By next year I think there’s a prospect that -- with an all-out effort on vaccination and reopening schools -- that we can really get the labor market back on track, later this year or next year.”

There were nearly 10 million unemployed Americans in February, almost double the pre-pandemic level, underscoring a lengthy road to recovery for the labor market. Other areas of the economy, including housing and manufacturing, have recovered much more quickly. U.S. payrolls increased by 379,000 last month, more than economists had estimated, while the unemployment rate dropped to 6.2%.

Georgieva said the IMF is “very supportive” of the policies the U.S. is pursuing to address the needs of the most vulnerable people to provide relief to the poor, calling them “very progressive.”

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