is a shortfall of 6. 8 million jobs relative to the pre - pandemic level and 9. 1 million jobs relative to the pre - pandemic trend, respectively. the employment - to - population ( epop ) ratio is 3. 2 percentage points short of its pre - pandemic level for prime - age workers, a group that is not affected by the elevated level of early retirements during the pandemic. thus, as of june, we had closed between one - fourth and one - third of the employment shortfall relative to last december according to a variety of measures. although the epop ratio for black individuals has improved more strongly than the overall ratio over the course of 2021, closing about 40 percent of the december gap, it remains more than 3 percentage points below its pre - pandemic level and more than 2 percentage points below the current level of the epop ratio for white individuals. currently, it is difficult to disentangle the effects on labor supply of caregiving responsibilities brought on by the pandemic, fears of contracting the virus, and the enhanced unemployment insurance that was designed in part to address such constraints. importantly, i expect to be more confident in assessing the rate of progress once we have data in hand for september, when consumption, school, and work patterns should be settling into a post pandemic normal. 1 / 3 bis central bankers'speeches i fully expect progress to continue, ultimately leading to a labor market as strong or stronger than we saw before the pandemic. looking ahead, if jobs were to continue to increase at the secondquarter average monthly pace, about two - thirds of the outstanding job losses as of december 2020 and nearly half of the gap relative to the pre - pandemic trend would be made up by the end of 2021. if, instead, the rate of job growth were to accelerate notably, those levels could be reached somewhat sooner. today ’ s data showed that core pce inflation rose 0. 45 percent in june, once again driven by outsized contributions from a handful of categories. new and used vehicles contributed just under 40 percent of the june increase in core pce, while price increases for travel - related items like hotels, airfares and rental cars contributed another 25 percent. 2 all told, price increases associated with vehicles and vacations, categories that comprise about 8 percent of the core pce basket, were responsible for over 60 percent of the june core pce price increase

##ary pressures are likely to prove more persistent or that expectations are moving above target. if inflation moves persistently and materially above our target, we would adjust policy to guide inflation gently back to target. there are risks on both sides of the outlook. there are upside risks to consumption spending associated with the high level of households ’ savings. there are downside risks associated with the delta variant. while the economy ’ s momentum is strong, vaccination rates remain low in some areas, and fears related to the delta variant may damp the rebound in services and 2 / 3 bis central bankers'speeches complicate the return to in - person school and work in some areas and slow the rotation from goods to services that account for three - fourths of the shortfall in jobs in coming meetings, we will continue to assess progress and the conditions under which it will be appropriate to start paring back the pace of our asset purchases. twenty - four - month core pce inflation is now running at a 2. 3 percent average annualized rate. in contrast, employment is still down by 6. 8 million to 9. 1 million relative to its pre - covid level and trend, respectively, and it has closed about one - fourth to one - third of its december gap. the determination of when to begin to slow asset purchases will depend importantly on the accumulation of evidence that substantial further progress on employment has been achieved. as of today, employment has some distance to go. it is important to emphasize that the achievement of substantial progress that will determine when the committee starts reducing the pace of asset purchases is distinct from the maximum employment and inflation outcomes that are in the forward guidance for the policy rate. remaining attentive to changing conditions and steady in our step - by - step approach to implementing policy under our new framework should ensure that the economy ’ s momentum is sufficient when tailwinds shift to headwinds to achieve and sustain maximum employment and inflation robustly anchored at 2 percent. 1 i am grateful to kurt lewis for his assistance in preparing these remarks. these views are my own and do not necessarily reflect those of the federal reserve board or the federal open market committee. return to text 2 the notable gap between the june pce reading and the cpi reading is due, in part, to the lower weighting of vehicles in the pce measure. return to text 3 for more information about the index of common inflation expectations ( cie ), see hie joo ahn and chad fulton (