Delays and price hikes are anticipated in the United States for holiday merchandise, a Federal Reserve official warned Sunday, calling for more to be done to boost the workforce.
“Right now, we see consumers trying to get out early and spend their money to get their goods before they run out,” Mary Daly, head of the San Francisco branch of the US central bank, told CBS.
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When shopping for the upcoming holidays, “people are buying it now and they’re being told oftentimes they can’t get it until after the holiday has passed,” she said.
“So there are going to be delays,” as well as “some pressure on holiday item prices,” the Fed official said.
To address this, it will be necessary to “get more supply to the labor market, to the goods market.”
In other words, to speed up the flow and production of goods, people who have left the labor market because of the coronavirus pandemic and now cannot return due to constraints such as childcare or health concerns, must be enabled to return to work.
The US labor market, which showed a strong rebound in June and July, adding more than a million jobs in each month, slowed in August and September.
In September, only 194,000 jobs were created.
“It is a volatile period we’re in right now, Covid is not behind us, so I don’t expect the job market to just be continuous,” Daly said.
“It is going to have these ups and downs, especially with the Delta variant,” she added, referring to the coronavirus variant that has spurred recent upticks in cases.
The Fed has said it wants to start tapering its asset purchases, which supported the United States during the pandemic, but it wants to see progress in the labor market before announcing the exact timing.
Most economists believe that September’s disappointing job creation, however, should not be an obstacle to an announcement about tapering at the central bank’s next meeting in November.