US Treasury Secretary Janet Yellen stated on Friday that the US economy reached a "soft landing," a phrase used to refer to an event in which the central bank is able to ease inflation and cool off a hot economy without creating an economic disaster.
“What we’re seeing now I think we can describe as a soft landing, and my hope is that it will continue,” Yellen said on Friday.
“The American people did it,” she added. “The American people go to work every day, participate in the labor market, and form new businesses. But President Biden has tried to create incentives that give Americans the tools they need to help this economy grow.”
Yellen’s comments follow a US job report that showed an unexpectedly strong job growth for the month of December, when the US economy added 216,000 jobs to the market. Those numbers exceeded forecasts. However, the year of 2023 showed 2.7 million jobs (225,000 a month) added to the workforce, which was down from 4.8 million (399,000 a month) from the year 2022.
“There has been a lot of pessimism about the economy that’s really proven unwarranted,” she added. “A year ago, most forecasters believed we would fall into a recession. Obviously, that hasn’t happened.”
The pull back from the post-COVID surge may be a result of the Federal Reserve’s efforts to pare back job and wage growth in order to reach the “soft landing” effect.
In a statement addressing the jobs report on Friday, the president acknowledged the sore topic. "I know that some prices are still too high for too many Americans, and I am doing everything in my power to lower everyday costs for hard-working Americans,” said Biden.