Abstract
Lisa Lynch started by addressing whether the “Great Resignation” is a transitory phenomenon or is expected to be more permanent. She observed that while the labor force participation rate has risen from its trough early in the pandemic, it remains well below pre-COVID levels. She remarked that while the vaccines increased reassurance, the Delta wave had stunted participation. She noted that the wide availability of boosters, emerging treatments for COVID and vaccinations for young children may improve participation. She noted that total employment was still 4.2 million jobs below early 2020, with notable shortfalls in leisure and hospitality, state and local government, and educational and health services. She observed that it likely will take some time to return to pre-COVID levels. She next turned to the recent rise in labor strife. She pointed out that there has been an uptick in strikes in 2021 that spanned multiple sectors such as manufacturing, healthcare, education, and food and accommodation. Factors behind these strikes included pay, health and safety, and better work-life balance. She concluded by discussing tightness in the labor market and the expected path of wage inflation. She pointed out that even though the unemployment rate has moved closer to pre-pandemic levels, it remains elevated for many groups of workers. She noted that wages are up, as are benefits: she expressed that these are part of a long overdue pay rise for many classes of workers, and should not necessarily lead to spiraling wage inflation. [Abstract derived from meeting minutes]