US Markets

Fed's Kaplan: data doesn't support firms' complaints on jobless benefits

Credit: REUTERS/ANN SAPHIR

Dallas Federal Reserve Bank President Robert Kaplan said on Monday that while "a lot" of his business contacts had complained that the now-expired $600 weekly benefits to the unemployed made it harder for them to hire, the data does not show that they hurt the job market overall.

By Ann Saphir

Aug 3 (Reuters) - Dallas Federal Reserve Bank President Robert Kaplan said on Monday that while "a lot" of his business contacts had complained that the now-expired $600 weekly benefits to the unemployed made it harder for them to hire, the data does not show that they hurt the job market overall.

"We've looked at a number of studies, we've done our own work: we don't see it as much in the data but I can tell you I'm hearing it from business people," Kaplan told Bloomberg TV. "While it may have made it hard for certain individual businesses to hire, it has helped create jobs, because it has helped bolster consumer spending, so the net effect still has probably been positive for the economy for employment."

Kaplan also said he did not agree with his colleague, Minneapolis Fed President Neel Kashkari, who at the weekend said he thought the U.S. economy should shut back down again for four to six weeks to suppress spread of COVID-19.

Instead, Kaplan said, universal mask-wearing could substantially mute transmission of the virus without a widespread lockdown. "I think we are going to have to learn to live with this virus. We are going to have to learn to reengage in our daily activities, but still control the virus," he said. "Widespread mask-wearing is essential to that."

He also said would not want to see the Fed try to shore up its easy monetary policy by aiming to get inflation back up to, and even a bit above, its 2% goal.

The Fed has already said it would keep rates near zero for the next couple of years, he said. "I would far prefer, when we do give forward guidance in the future, that we tie it to our dual mandate, and particularly tie it to unemployment, along with making progress on inflation."

(Reporting by Ann Saphir; Editing by Kevin Liffey and Nick Zieminski)

((Ann.Saphir@thomsonreuters.com; +1 415-677-2516; www.twitter.com/annsaphir; Reuters Messaging: ann.saphir.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More