Treasury Secretary Janet Yellen reassured the public on Saturday that the U.S. economy is strong, despite some weak job reports that have worried investors and affected the stock market. She spoke at the Texas Tribune Festival in Austin and mentioned that although job growth has slowed compared to the initial hiring frenzy after the Covid-19 pandemic, the economy is still in a good state and essentially at full employment.
Yellen’s comments followed the release of the latest jobs data by the Bureau of Labor Statistics, which showed lower-than-expected job creation numbers for August. Even though the unemployment rate dropped to 4.2% and job growth increased compared to July, the stock market saw a decline, with the S&P 500 having its worst week since March 2023.
Despite these concerns, Yellen tried to reassure everyone by saying that she doesn’t see any major issues with the economy. The data has led to questions about whether the Federal Reserve can handle a “soft landing” by raising interest rates to control inflation and then cutting rates before a recession hits. The Fed is expected to lower interest rates soon, which Yellen believes is part of achieving a soft landing for the economy.
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