Fed official says he doesn’t buy the ‘Great Resignation’ — suggests employers play up labor shortage to avoid paying higher wages

Minneapolis Federal Reserve President Neel Kashkari said he doesn’t “really buy the Great Resignation” — the term for the Americans who have quit their jobs in droves during the pandemic.

Instead, it’s more that people are leaving certain careers to seize better opportunities in others, Kashkari said during a talk Friday at the University of Minnesota’s Carlson School of Management. Workers employed in long-haul trucking might be entertaining local driving jobs that keep them closer to their families, for example, while child-care workers could be considering less stressful, higher-paying jobs in retail. 

“There’s a churn away … from the toughest jobs to more attractive jobs,” Kashkari said. “That’s something we’re all going to have to adjust to, because we need long-haul truck drivers; as much as Silicon Valley says they’re all going to be out of a job soon, it’s going to take longer than they think. And we need child-care workers. So we’re going to all have to make adjustments, and that probably means adjustments in wages.” 

Earlier in the talk, Kashkari also said that businesses “always say” there’s a worker shortage, “because they don’t want to have to pay up higher wages.” (To be sure, the tight labor market has forced higher wages, though inflation is eating into those gains.)