MNI BRIEF: Fed Barkin- Quits Rate Could Add Pressure to Prices

Richmond Fed President Tom Barkin said Friday signs point to continued and perhaps, more broad-based, pressure on labor market quits rates this fall, which could put additional upward pressure on inflation.

"There may also be a backlog of quits. Many workers hung onto their jobs over the past year and a half, waiting to make a move until the pandemic ended," he wrote in a blog released on the Richmond Fed's website. "Some may have been motivated by a desire to avoid further instability in an already unstable period. Others may have wished to avoid a fully remote onboarding experience. We may see some of this backlog clear over the next several months."

"For the economy as a whole, it could mean inflationary and productivity pressures," he said, citing higher wage premiums that typically go to those employees who switch jobs. MNI has reported that higher-than-expected inflation readings linked to supply chain disruptions is testing the Fed's view that a surge in prices is transitory.