MNI POLICY: Fed's Harker: Labor Markets Must Adapt to AI

Harker Silent On Interest Rate Policy 

By Evan Ryser

     NEW YORK (MNI) - Federal Reserve Bank of Philadelphia leader Patrick Harker

said Wednesday that tight labor markets and developments in artificial

intelligence present an opportunity to improve the workforce. 

     "Unemployment is at a half-century low. Businesses are having trouble

finding skilled workers. This has, to some extent, forced us to view the

workforce from a new perspective," Harker said in prepared remarks to be

delivered at Drexel University in Philadelphia. 

     "For one, the change is coming a lot faster than it used to. For another,

the labor market itself is different. Together they create a unique set of

circumstances that pretty much gives us the chance of a lifetime," Harker said.

     Harker's first remarks since last week's FOMC gathering did not touch on

the interest rate path. Last week's meeting resulted in a third rate cut for

this year, leaving the federal-funds target between 1.50% and 1.75%. 

     Harker expressed concern and hope about how artificial intelligence will

impact labor markets and noted that with the tight labor market now is the time

to train, recruit, and upskill a workforce that can adapt to future needs.

     "We know who's likely to be most affected. It's the people who are already

disproportionately represented among vulnerable workers -- women, people of

color, younger people, and workers in low-skilled positions." 

     "But this presents an opportunity...as long as we make that investment, and

make it in the right way." 

--MNI Washington Bureau; +1 202 371 2121; email: evan.ryser@marketnews.com

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