Press conference exchange between RACHEL SIEGEL and Fed Chair Jerome Powell:

user: Thank you, Michelle. And thank you, Chair Powell, for taking our questions. I wanted to follow up on what you said about there tending to be less in the way of economic implications from each wave of COVID cases. Could you elaborate on what you’ve seen to that end during previous waves? And then, looking forward, how vulnerable is the labor market to the Delta variant? I’m thinking or wondering if you have concerns that jobs that may have come back in travel or tourism could be susceptible if people started reconsidering their travel plans or if caretakers were suddenly faced with the prospect of schools not reopening. How do you see some of those risks going forward? Thank you so much.

assistant: Sure. So if you remember the, the summer wave last year of COVID, which was largely southern and western states, the economy just performed much better than anyone expected. You know, we, we were coming off the spring wave, where there were a lot of shutdowns. And then this big second wave hit, and I think the natural thing to do is to expect that, that it would have a real impact on the economy. And it was much less than, than people thought. People—what’s happened is, first of all, many people are vaccinated. They’re going on with their lives. Secondly, we’ve learned to live with it. A lot of industries have, have improvised their way around it—particularly, for example, buying a new home. That, that process of buying a new home very quickly moved to much more of a virtual process. And so they were able to, you know, to, to do that. And other industries as well have gone to take-out and, you know, no-contact things. It’s—so that can all—it seems like we’ve learned to, to handle this. Now, I think people would like to get back to, to, you know, the way things were. And I, I, I hope to some extent, we will over time. You know, of course, the big wave we had last winter did have significant employment effects, particularly in, you know, hospitality and leisure and other entertainment—other, other areas with a lot of direct contact. A lot of jobs were lost then because that was a very strong wave that happened in, in, in the winter months last year, just before the vaccines arrived. So with Delta, we’re just going to have to watch. Again, with, with, with a reasonably high percentage of the country vaccinated and the vaccine apparently being effective—we’re not experts on this—but it, it seems like the—a good—a good going-in estimate would be that the effects will probably be less. There probably won’t be significant lockdowns and things like that. But, again, those, those are not decisions for us or, or, or—nor is it something we’re be— we’d be expert in. In terms of the, the, the channels, you know, I—this is—this is kind of speculation, but it’s pretty—it just is that people, you could imagine school districts deciding to wait a month or two for the—for the—for the Delta wave to go. I’m not saying this’ll happen, but that it’s easy to imagine that. It’s also easy to imagine that some people might say, what? I’m just going to—I’m just going to wait a couple of months before going back to work. Wouldn’t be hard to imagine that happening. If, if schools don’t open, then caretakers have to stay home. And if people don’t go back into the labor force, then the job growth won’t be as strong, those kinds of things. So I don’t—it doesn’t—it doesn’t—again, sitting here today, not being able to really know the future—it doesn’t seem as though the effects will be very large. But there may be effects. And they—it may be that the effect is to slow the economy down just for a period of months—or not. There are many parts of the country where it might not have an effect, and we’re just going to have to, to see what the economic effects are.