>> from bloomberg world headquarters new york, i am caroline hyde. romaine: i am romaine bostick. we saw that cyclical rotation once again. the s&p 500 closes at a record high. job: the question is "what'd you miss?" caroline: it by joe's favorite day.

joe: my desert island indicator. caroline: pretty stellar report. we can come into the details of demographics. are we see more quality in the recovery? how soon will we see the fed focused on seeing a more inclusive jobs market decides progress has been made and we are there? but i am afraid they are looking at the glass half empty. how much is a rise in the delta variant clouding outlook? first of all, let's talk about this data point, joe. is it a data winning debut? joe: exactly right. overall, this was a solid, consistent jobs report. basically every indicator you would expect to see, better than expected, jason furman having tweeted -- one of the purists -- look, we still have very different, you know, uneven recovery. there is an uneven recovery with respect to race, uneven recovery

with respect to men and women. you have older folks dropping out of the workforce. employment population ratio is below crisis level. there are clearly a lot of works to do. even with a good number. romaine: and a lot of adjusted factors here, working to the upside surprise. joe: joining us for more, valerie wilson, director of the program on race, ethnicity, and economy economic policy institute. thanks for joining us. picture, do you agree there is a lot to like in this report? valerie: i do. we have had two consecutive months of job growth that exceeded expectations. it was revised upwards to 938,000 at the three-month average pace where we are moving now and we should be well on our way to pre-covid rates of unemployment by the end of next year. caroline: well on our way, in spite of the delta variant, in spite of the labor frictions we

have seen in the market. valerie: yeah, so that is a remaining question mark, how much of an effect the delta variant will have on the pace of job growth. the question -- the good news there is we are ahead of the pace of where we should be, so even if things slowed a bit in the next couple of months, as long as we do not have an extreme slowdown, we should still be pretty much on pace to get to pre-covid unemployment by the end of next year. romaine: when we look at some of the expanded benefits and expiration in states for expanded benefits, there are some folks we talked to that look at today's numbers and say there is a direct relationship between the expiration of some benefits and the job schemes we are seeing in the official data. is that a link to far to make? --too far to make? valerie: i think it is. the numbers do not provide information on state specific rates of job growth, so we do not know whether this states that have cut benefits have seen

faster growth than they had before the cuts were made. the limited information we have seen so far is that states that cut benefits did not see any much faster growth than they would have without cutting those benefits. joe: of course, so we have known we have had two solid reports in a row. the two before were a little disappointing. did something change? are we learning something about matching or something else? or is this noise and it took longer for the economy to really kick into gear then maybe people expected in the spring? valerie: i think it is some of the lag and things correcting themselves. i think the initial push for the vaccine, we are starting to see the effects of that as more businesses are opening and hiring kicks up across the economy. and, you know, we still remain

to see what will happen as we learn more about the delta variant. hopefully, a push toward more vaccinations will continue and it will stall or avoid that slowdown in the future. caroline: you are the director of the program on race, ethnicity and the economy. when i look at the number of women coming back to the workforce, white women are doing pretty well. black and hispanic women not. how much are you still seeing a variation in race? how much still needs to be done for the federal reserve to seek substantial progress? valerie: yeah, so the disparity of unemployment rates are something that we see all the time, whether it is talking recession on recovery. this past month we did see a significant improvement in the black unemployment rate, down to 8.8% from 9.2% the month before, but even with that being the case, we continue to see significant gaps across race and

ethnicity. the white and employment rate is at 8.4%. there is a big spread there. there other concern we would have in terms of the graphic is the issue of long-term unemployment and what that means in terms of what share of people who are unemployed have been out for 27 weeks or longer? this is proportionately tends to be people of color and older workers. romaine: do you have any sense about the folks who move to the sidelines during the pandemic, i guess what percentage or how many are probably going to stay there? basically, they have no intention of coming back to the workforce. valerie: yeah, i do not have a clear sense of how many people that would be. what we tend to find is that a lot of what we see for over workers, people who decide to retire because after an extended time, they have been able to find -- they have been unable to find work, so the option is to have retirement benefits.

again, as the economy continues to build and opportunities come more available, what happens to those who perhaps decided to step out of the workforce or not, we will see. joe: when we talk about labor r force work participation rate, i think it remains lower by 1% versus re-crisis level -- pre-crisis level. should the fed look at that in your view and consider that as labor markets like with the goal of -- market slack with the goal of getting that to precrisis level? valerie: i think they should take a careful look at what is happening with labor force participation. even with the last few months of a populace job report, we still have to recognize that we are still significantly behind in terms of the job growth pace, in terms of jobs lost, and the interruptions that it created in

families and households, and what that means for parents, and working mothers in particular, in terms of their ability to reengage with the workforce. so the fed should keep a careful eye on workforce participation and how that may look differently. different groups -- differently for different groups. romaine: that is valerie wilson of the economic policy institute. coming up, we will talk about the jobs report and how it affects the markets, the rally, and what it all means for the fed and jackson hole. matthew klein, founder of the newsletter "the overshoot" is coming up after the break. this is bloomberg. ♪

romaine: all right, that jobs report got everybody talking about tapering. we heard from a lot of members of the fed who basically said now is the time to start. i am told you spoke with a fed member. joe: yeah, on the podcast this week, we spoke with robert kaplan. the full episode is out monday, take a listen to what he said about a taper. >> i would be supportive of digesting these purchases soon, but, the other thing i would say is once we start the adjustment process, i would probably be prefer to have it more gradual. what does gradual mean to me? probably baseline over eight months, let's say. joe: for more, let's bring in matthew klein, the overshoot" and co-author -- "the overshoot" and the co-author of a book on trade wars. let's go over today's report and the fed.

do you think the data we got today, strong, also confirming last month revised higher, is enough to make it clear they're going to start setting a day per tapering asset purchases? matthew: it depends on who you ask. there is an interesting speech earlier this week from richard clarida in, the vice chairman of the fed, and one of the architects of the new framework announced last fall, and he explicitly said that the unemployment rate hitting 3.8% would be consistent with him for the first rate hike. we do not know the timeframe between the beginning of the tapering of asset purchases and rate increases, but given that unemployment is at 5.4% and we had a big improvement, that could come relatively soon. it also depends on what others think. i think there was a perception that calrida was more on the debtors -- clarida was more of the devilish side compared to others. it is hard to say.

the language in the fed statement is they will not begin raising interest rates until they reach maximum unemployment. other than that, there's not a lot of guidance. caroline: some of the slack we are seeing in the labor market with participation rates, 5% sounds really good but how many people are going back into the labor force? some people still have to be caregivers as we face the delta variant. matthew: right, so compared to before the pandemic, the labor force is still about re-.1 million people smaller, but that is dropping quickly. rates are rising rapidly as the job market improves. that improves as schools reopen and will hopefully normalize and we should see all those people getting back to work. it also isn't clear that the pre-pandemic was at its maximum in any case. we have had several million people who said they were not

only in the labor force that would be willing to work if the job would become available. a lot of the employment came from the years we had the pandemic that were larger than the number of people unemployed, which meant the labor force effectively grew more than expected. if you think about the share of people who are working or who were working before the pandemic, that is still low relative to what it was in the late 1990's, adjusting age, so there is a lot of possibility for employment to go higher. romaine: there was some interesting data that came out of the household side of the survey that was not included in the broader payroll count in regard to part-timers and self-employed. something like one million jobs in that category. how much does that factor into it? or can we extrapolate that there are a lot more people who could potentially be in the pipeline to come back onto the full-time payroll? matthew: i think that is right. one thing that is interesting

and a pleasant aspect of the recovery is the shares of people working part-time involuntarily, in other words, they preferred full-time jobs were available, has dropped dramatically and basically back to where it was before the pandemic. that means there are still 4 million plus people who prefer to work full-time but don't have the demand for the hours. that is encouraging. the flipside is there are people who want to work more hours. if you were to work -- look at the statistics january 2020, you could construct a story of 10 million plus people who would be willing to work who were not working. you know, how realistic is it that all people get jobs immediately? tough to say, but if you look at the people who were out of the labor force and people working part-time, that is a relatively large number. how all of that flows through an inflation in what th fed looks

at is a different question, but looking at what they are counting, there are a lot of people who are sidelined to work. joe: let's go back to where you said, even if we were going to get back to precrisis levels of employment, it is not clear that was full employment at any stretch. with the new framework, we are coming up on the one-year anniversary of the jackson hole, the idea that the fed is maybe going to be more humble and how far it can push the unemployment rate, and maybe it will wait to see inflation actually pick up on a sustained basis before assuming that because the unemployment rate also is at a certain level where something is going to kick in, do you believe the fed is still committed to that approach? or in the last year with the pickup we have seen in inflation, do you think we have gotten cold feet? matthew: i think that is an open question. i think we should be careful saying the fed is not the

unitary entity. there are a lot of diversity points. i think it came up with a compromise set of language they could all agree on at the time, but we are already seeing different speeches people are giving and how they interpret what that means. it is tough to say yes. if we literally take their claim that they will not raise interest rates, forgetting the active purchase side of things, if they do not raise interest rates until full employment is reached and inflation is 2% and is set to stay at at least 2% for a sustained period, that conceivably would give them a lot of runway to not raise rates for quite a few years potentially. it depends on how you think the economy will unfold. under that framework, interest rates would have been at zero in january 2020 and could've stayed there a long time. i mean, clarida's speech indicates and others, how do they judge what the forecast is

for inflation? that is where it gets tricky. caroline: matthew klein, really interesting. matthew has done a lot of work around the labor forces and restaurant industry. coming up, we will talk about that as as this is are struggling to hire employees. real friction is being felt in the restaurant industry. the cofounder of a brooklyn pizza spot is talking to us about the challenges of getting workers. that is next. this is bloomberg. ♪

caroline: the jobs report they have been strong, but hiring is still an issue for many businesses, especially the restaurant industry. i sat down with emily, a co-owner of a pizza spot, about the challenges. >> it has been a gut wrenching,

challenging year-and-a-half, two years at this point. we were really finding a lot of momentum in opening this location in the fall of 2019 right into our first restaurant in washington, d.c., in december. we had anticipated a lot more snowball from there, and everything just stopped. it has been a one breath at a time process to come out the other end. caroline: how did you have that resilience and fortitude during 2020? what got you through it from an emotional perspective of worrying whether people were going to come back to restaurants? what did you do to help yourself going and employees going? emily: resiliency is an interesting skill. you don't build it unless you go through hard stuff, so we are all tilting that more and more. i really have to credit our ceo, my partner, he is a very seasoned restaurant tour -- restauranteour and he has been at the helm of the ship and

coaching a lot of are much younger, newer teams through that day by day process of there will be an end to this, there is another side, and we really just need to take it one step at a time and adapt and evolve and be as creative as possible and really take care of the key people who are riding the wave with us. caroline: talk about the creativity because you did have it. obviously, pizza, burgers scream out delivery, but you are also teaching people how to make it. what are some possess models you tried on and whether or not you will keep them on? emily: we have very natural and beautiful partnerships with gold belly, which has been nothing short of a godsend during this time. we have been using that as a platform for the pizza classes and shipping it across the country. that has allowed us to really build a fan base and reach guests that we otherwise would not have, even in our regular

brick-and-mortar stores. that has been really, really nice. and then just adapting with technology, working with pos integration systems to help streamline the process of different ways people are ordering food these days. caroline: covid was difficult, but some of the pros you can see , i loved being able to do it delivery kits and making it at home, i loved been able to do experiences where i don't have to make a pizza. am i so going to be able to do that? emily: i hope so. i have a great time teaching those classes. i think it will be a sense of the hybrid. i'm curious into the holiday season, which i was doing three pizza shows and i, five nights a week, it was crazy, but i think it is a nice way to create unions for families that cannot be together, like you don't have a birthday party, you have a family in arizona, maine, and

mississippi, you can all do a pizza class online together. we are adapting as people are coming back into the restaurant, so now we will offer those in person, too, which will be a different experience of fun. i don't think it is going away, but i think it will find a balance. caroline: it is interesting as a woman helm in business, i know you have strong partnerships, but what are you thinking now of women who are being left behind in the workforce? people of color, 2020 was this recognition of that, with people focused on kindness and community, i'm sure it is something you thought was wearing the obvious anyway. how are you aching sure you hire as many people who have been left behind? emily: absolutely. we really do value -- one of our written values is inclusivity. we have a diverse management pool. we love bringing people up from hourly positions and moving on up where hopefully over time, because we are a small company

becoming a medium-sized company, we are in the process of trying to build mentorship programs and that sort of thing so people can come up through the ranks, which i think is great. we try to support black-owned vendors when we can. i will give a great plug to an awesome business, zach and zoe honey, eight black run family business from western new jersey in the pizza kits for my online classes. they are a beautiful husband-and-wife team, they named the company after their kiddos.they emerging that is a tiny way we can support -- they are a small black business emerging that is a tiny way we can support. caroline: emily hyland, such a nice woman, but also taking out by the box. joe: i'm going there tonight. i saw that and thought i had to check it out. caroline: you have got to get detroit pizza. you're also going out where? it is monday. joe: starting monday, i will not be cohosting, i will focus more

on writing and podcasting. but i will be around. bring me on at 4:30 to do market wraps. i think we will do an interview together tuesday. i'm not really going anywhere, just the other side. romaine: we will play a sad sarah mclachlan song. joe: bloomberg technology is up next. caroline: this is bloomberg. ♪

♪ >> from the heart can belly -- this is bloomberg technology. emily: i am emily chang and this is bloomberg technology. more than 100,000 new covid cases in the u.s. today. 600,000 around the world.