Trying to “woo back” lost employees from the pandemic comes with a cost
When it comes to inflation and burdens on farmers, a Kansas City Fed economist says farmers are still dealing with a lack of workers who might have departed during the pandemic.
The effort to “woo” them back is contributing to the dreaded wage-price spiral.
“When businesses have trouble attracting workers, they will have to start to increase wages to try to attract those workers. And once that happens, businesses are paying more for workers. Then they will have to then in turn look at their own balance sheets and and increase their prices to the consumers,” said Megan Williams.
While additional interest rate hikes are never popular, Williams says they are necessary for inflation to go down.