Federal Reserve Board Governor Lael Brainard speaks at the John F. Kennedy School of Government at Harvard University in Cambridge, Massachusetts, USA, on March 1, 2017.
Brian Snyder | Reuters
Unemployment of the highest paid workers in the United States exceeds 20%, a figure that, according to Federal Reserve Gov. Lael Brainard, underscores the importance of political aid to the economy.
The figure indicates how uneven the recovery has been since the efforts to control the Covid-19 pandemic resulted in the largest quarterly drop in GDP since the Great Depression.
“The damage caused by COVID-19 is concentrated among the already challenged groups,” Brainard said in a speech Wednesday. “The K – shaped recovery remains very uneven, with certain sectors and groups
experiencing substantial difficulties “.
At a time when the national unemployment rate has dropped from the pandemic peak of the current 14.7% to 6.7%, Fed economists estimate that the unemployment rate is likely to be the quartile unemployment rate lower than wage earners is “over 20 percent,” Brainard said.
This is given that the black unemployment rate is 9.9% and the Hispanic rate is 9.3%, while that of whites is 6%.
Fed officials have made gains in “inclusive” employment a priority and have adjusted policy to try to make that happen. A new approach will allow inflation to exceed the Fed’s 2% target and lower the unemployment rate from what had traditionally been an indicator of higher inflation before the Fed raised interest rates.
In recent days, central bank speakers have offered differing views on the future of policies, and some have worried that inflation will rise faster than expected.
Brainard did not commit to a period of time to adjust policies, but noted that “the economy remains far from our goals.”
“We are firmly committed to achieving our maximum employment and average inflation targets,” he said. “It’s too early to say how long it will take. The Committee has made it clear that it needs to make substantial progress towards our goals before adjusting for purchases.”
The Fed’s current buys at least $ 120 billion in bonds each month and has kept its benchmark short-term lending index anchored close to zero. Fed officials have continued to ask Congress for more tax aid.