Fed's Powell says immigration surge boosted unemployment rate
Acting Labor Secretary Julie Su was asked about whether migrants who cross the border should be allowed to work in the U.S.
Federal Reserve Chair Jerome Powell said Wednesday that immigration is helping push the unemployment rate higher as they enter the labor force and look for jobs.
Powell was asked about whether the level of job creation in the economy, which has been a little more than 100,000 on average for the last three months, is alarming and if the labor market can continue slowing down through fewer job openings as opposed to job losses.
«On the job creation… it depends on the inflows,» Powell said. «So if you're having millions of people come into the labor force, and you're creating 100,000 jobs, you're going to see unemployment go up. So it really depends on what's the trend underlying the volatility of people coming into the country.»
«We understand there's been quite an influx across the borders, and that has actually been one of the things that's allowed the unemployment [rate] to rise. And the other thing is just the slower hiring rate, which is something we also watch carefully. So it does depend on what's happening on the supply side,» he explained.
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Federal Reserve Chair Jerome Powell noted the rise in immigration can boost the unemployment rate as new workers enter the labor market. (Al Drago/Bloomberg via / Getty Images)
The unemployment rate has risen in recent months amid a slowdown in hiring. It reached 4% in May for the first time since January 2022 and hit 4.3% in July, before declining to 4.2% in August.
Powell's comments come after the August jobs report showed a decline in employment among native-born workers while the number of employed
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