Yellen admits labor participation 'quite depressed' compared to pre-pandemic levels

U.S. Treasury Secretary Janet Yellen has admitted that labor force participation is "quite depressed" compared to pre-pandemic levels, blaming COVID-19 for the issue. 

The U.S. economy has sought to rebound as widespread access to vaccinations and adjustments to labor practices should allow for Americans to get back to work; however, a lack of labor supply has exacerbated the continuing supply chain crisis. 

There were 10.4 million job openings at the end of August and 11.1 million openings the month before, the highest on record since at least December 2000, when the government started recording that figure. At the same time, the Labor Department said that the number of people quitting their jobs jumped to 4.3 million in August from 4 million in July. 

Yellen admits that the labor force participation isn’t where U.S. officials thought it would be, but she has blamed COVID-19 rather than any Biden administration policies.

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"First of all, the programs that were put in place … really were intended to support households and families to get through this so they didn’t take a huge hit to their income," Yellen said in an interview with "Face the Nation" on Friday. "Americans feel good about their finances, and that’s not an accident." 

"The supply of workers is not back up to normally," Yellen admitted. "Unemployment is low, labor force participation is quite depressed compared to pre-pandemic levels."

Yellen argued that the low participation reflects "concerns of COVID and exposure to COVID." She also cited issues with childcare roles, which would contribute to labor supply suppression. 

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The widespread availability of COVID-19 vaccines from Pfizer, Moderna and Johnson & Johnson should have helped bolster employment: some states, such as New York, Florida, Minnesota and Virginia, have achieved over 60% full vaccination; states such as Texas, Kansas, Arizona and Nebraska have distributed at least one shot to over 60% of its population, according to the Mayo Clinic. 

But some states, such as Mississippi, Louisiana, Montana and Michigan, have yet to reach those same levels. Experts cannot agree on whether it is due to availability within those states or vaccine hesitancy, but recent develops may provide an alternative that will help those who are unwilling to get the vaccine. 

Biotech giant Regeneron has applied for two approvals from the FDA after receiving approval from the U.K., Australia and Japan, as well as a European commission, for use of its antibody cocktail for outpatient treatment and for individuals with an increased risk of developing severe symptoms.

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"This approval adds to the growing number of countries that have recognized our antibody cocktail as an important therapy against COVID-19 to treat non-hospitalized patients already infected with the virus and to prevent infection in the first place," said George D. Yancopoulos, president and chief scientific officer of Regeneron. 

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"With today's approval, we hope countries in the European Union will accelerate their adoption of this formidable tool to reduce the burden of COVID-19," he added.

The Associated Press contributed to this report.