Fed President Harker Sees Employment Shortfalls as a “Supply” Problem

For immediate release

Contact: Daneil Mazone, Manager, Media Relations

Philadelphia — Patrick T. Harker, president and CEO of the Federal Reserve Bank of Philadelphia, addressed a virtual audience at the Philadelphia Business Journal Economic Forecast event about the state of the economy in light of the continued impact of COVID-19. Citing millions of job openings and widespread labor shortages, he said that employment shortfalls are not a demand problem, but rather a supply problem that must be fixed through methods other than monetary policy.

Harker also expressed concern that inflation is proving “persistent and higher” than the Federal Reserve’s long-term target of 2 percent. “The inescapable logical conclusion of this situation ― inflation higher than we want and a very robust jobs market ― is to tighten monetary policy,” he said.