Federal Reserve Chair Jerome Powell says, 'the recovery is far from complete.'
A new Labor Department report published Thursday found that jobless claims fell sharply to 684,000 this week. Experts say these lower numbers of unemployment claims could be one sign the economy is improving, but there are other measures that must be taken to ensure a full recovery.
The report noted that the number of Americans applying for unemployment benefits dropped sharply from 781,000 last week to an all-new low since the beginning of the pandemic.
And a cautiously optimistic new report by Brookings Institution senior researchers projected that United States employers are poised to add between 700,000 and 1 million jobs a month over the course of 10 months.
Federal Reserve Chair Jerome Powell also told the Senate Banking Committee on Wednesday that the economy is markedly improving, in part due to strong policy measures taken to support hurting families and businesses.
Powell noted in his remarks that employment increased by 379,000 in February and the leisure and hospitality sector recovered approximately two-thirds of the jobs lost in the preceding two months.
"The recovery has progressed more quickly than generally expected," he said, "and looks to be strengthening. This is due in significant part to the unprecedented fiscal and monetary policy actions I mentioned, which provided essential support to households, businesses, and communities."
However, he said, workforce participation remains well below pre-pandemic levels, and vulnerable groups remain deeply affected by the economic recession.
“But the recovery is far from complete," Powell added. "So at the Fed, we will continue to provide the economy the support that it needs for as long as it takes."
He also pledged to protect low-wage workers on the front lines and in service sectors as well as Black and brown Americans who have been hard hit by the recession.
Treasury Secretary Janet Yellen told the Senate Banking Committee that while economic recovery is nowhere near complete, the economy is trending upwards.
And Democrats' recent $1.9 trillion COVID relief package could make all the difference in moving toward economic recovery, she said, noting, “With the passage of the rescue plan, I am confident that people will reach the other side of this pandemic with the foundations of their lives intact."
Yellen also credited the unemployment benefits expansion in President Joe Biden's American Rescue Plan for part of the economic turnaround America is beginning to see.
"While unemployment remains high, it’s important to provide the supplementary relief,” she said to the committee.
Michael Madowitz, an economist with the Center for American Progress, told the American Independent Foundation, "We're certainly hoping for the economy to give more signals it’s starting to pick up. Today’s unemployment claims are a good sign, but only in the context of the pandemic — we’re still well above any record from the last huge recession."
He added that more stimulus will be needed from the federal government and the Federal Reserve to kickstart the economy: "The American Rescue Plan will be helpful, but it's supposed to put workers in position for a recovery, not bring the 12 million jobs we need back."
Heidi Shierholz, senior economist and policy director at the Economic Policy Institute, told the American Independent Foundation that while full economic recovery is a ways away, "the good news is the $1.9 trillion American Rescue Plan is providing critical relief and recovery to millions of working families and setting the stage for a robust recovery as more people get vaccinated."
Newly appointed Labor Secretary Marty Walsh commented Wednesday night that despite positive trends upward for the U.S. workforce, there are other factors needed in order to achieve full economic recovery — such as addressing the widespread departure of women from the workforce during the pandemic and focusing on job training.
"Women have dropped out of the workforce in higher numbers than I think anyone ever anticipated," Walsh said.
Job training is another piece that we have in the Department of Labor and working on job training and getting those dollars out the door. Some of those industries that we have lost during the pandemic, we're not going to get them back. So we need to make sure that we can retrain American's workers, so they can access the jobs that are available now for them.
Walsh also noted that expanding access to child care would also boost economic recovery, ans said successful vaccine rollout will be a key component of a full economic recovery — a point upon which other experts agree.
"With the vaccinations happening, and the president's very aggressive plan to get vaccines in people's arms, that's also part of this whole plan," Walsh said. "So, there's lots that we have to do. And the beauty is that President Biden and Vice President Harris have a plan to move forward."
Published with permission of The American Independent Foundation.