Treasury Secretary Janet Yellen expressed cautious optimism on the United States’ economy, saying a recession is still “not completely off the table,” but the country appears to be on the right path to bring down inflation.
“It’s not completely off the table,” Yellen told CBS’ “Face the Nation” when asked about a potential recession following the June jobs report that was the weakest showing since December 2020. U.S. employers added 209,000 jobs in June compared to May’s showing, which added 306,000 jobs.
But Yellen added the jobs report was to be expected given the labor market’s expansion in recent months.
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“But we would expect, with the job market as strong as it is now, to see a slower pace of ongoing job gains,” Yellen said. “Prime age labor force participation is at the highest level in several decades, so we’ve seen this strong job market attract workers back to it. But as that stabilizes at a high level, we should expect the monthly job gains to be coming down toward a more normal level.”
A recession is “a significant decline in economic activity that is spread across the economy that lasts more than a few months,” according to the National Bureau of Economic Research, which looks at indicators including employment, consumer spending and more.
Yellen attributed the labor market to President Joe Biden’s economic policies, which she said contributed to a “very rapid, dramatic rebound” of the U.S. economy.
“When the pandemic struck, there was huge job loss and a contraction in our economy. And as recovery took place, due to President Biden’s economic policies, and success with our vaccination effort, there was a very rapid, a dramatic rebound, the labor market recovered,” Yellen said. “And now growth has slowed somewhat back to more normal levels.”
Contributing: Paul Davidson, USA TODAY
