Comments from Quarles

  • Doesn't think we need to see participation return to pre-covid levels because of baby boomer retirements
  • Fed looks at a variety of labor force measures
  • Fed has not identified a specific target for maximum employment

I'm intrigued by the participation rate argument. Many at the Fed are saying that more people are retiring but I find that hard to square.

Here is US participation:

US participation rate

Contrast that with Canada, which has a slightly older population and is behind the US in the pandemic reopening.

Canada labor force participation

I think the US workers will return.