(Reuters) – Women, minorities and low-wage workers have been disproportionately affected by pandemic-related job losses and efforts to reopen the economy should include programs that improve job quality and make child care more affordable, Boston Federal Reserve Bank President Eric Rosengren said on Friday.
“Absent such an effort, many individuals will continue to be held back from participating in the labor market, with negative repercussions for the economy as a whole,” Rosengren said in remarks prepared for the Yale Economic Development Symposium.
The robust support provided by the Federal Reserve and fiscal policymakers was appropriate given the severity of the crisis – and will likely stay in place until the economy has fully recovered, Rosengren said.
“Policymakers have reacted aggressively to the current pandemic-driven economic situation and appear prepared to continue with additional fiscal and monetary policy actions as needed,” he said.
While the pace of coronavirus infections is slowing, a true economic recovery won’t happen until more people are vaccinated against the virus, Rosengren said. When that happens, the savings some consumers built up during the pandemic could lead to a surge in demand for services that have been limited by social distancing requirements, he said.
“A successful vaccination rollout by the middle of the summer suggests that by the second half of this year a robust economic recovery should be under way,” Rosengren said.
The policymaker reiterated the central bank’s commitment to keep interest rates low until the Fed reaches its 2% inflation target and to keep purchasing $120 billion a month in bonds until more progress is made toward the Fed’s goal of maximum employment.
(Reporting by Jonnelle Marte; Editing by Chizu Nomiyama and Jonathan Oatis)