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Business

Growing workforce could slow Fed rate hikes

Opening sequence

Opening sequence

Business

Growing workforce could slow Fed rate hikes

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17:01
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COMING UP:Growing workforce could slow Fed rate hikes

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Transcript

00:00:01
>> Inflation is heating up and unemployment is heading down. Just like the Federal Reserve wanted them to. All the pieces now in place for Fed Chief Janet Yellen to finally start raising interest rates. But, the Fed doesn't seem to be in a rush and this might be one reason why.
00:00:19
Reuters' Fed Correspondent Howard Schneider.>> There's evidence over the last couple of years that people who are out of the labor force sort of on the sidelines, not looking for a job at all, have been coming back in and getting work at a pretty unprecedented pay. So the fact that people are coming off the sidelines directly into jobs, really encouraging for Janet Yellen and maybe a reason why the Fed wants to see this process continue as long as possible.
00:00:42
>> Even communities that suffered from chronically high unemployment are now seeing rates fall.>> I saw this in effect in a trip I made to St. Louis recently. If you remember some of the northwestern suburbs there like Ferguson, seeing of a police shooting that touched off some riots a couple of years ago.
00:00:59
Unemployment there is very, very, high. And at job training centers there, they get a sense really of, I mean, the parking lot is just full of people who wanna take advantage of this buoyant labor market.>> So now the Fed that has tried everything in the book to get the economy going again is willing to standby and wait to see how this plays out.
00:01:17
But slow to hike doesn't mean no hike.>> So it looks like they're gonna make another move in December. What I think this discussion is about right now is the pace after that.>> The rate hikes in 2017 may be few and far between. Another experiment by a Federal Reserve willing to do what it takes until the economy is strong enough to make it on its own.
00:01:41
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