“You likely will continue to see inflation above the Fed’s two percent target for a lot of 2022, but not the kind seen in the second half of 2021,” says Alex Williams, research analyst with Employ America. “That is going to play a major role in fiscal spending decisions at the federal level and maybe at the state level.”
“Consumer spending is likely to be buoyed by strong labor markets and gross labor income growth in 2022,” said Williams of Employ America. “This is in contrast to the years leading up to the pandemic, which saw tightening labor markets without the kind of wage growth that we’re seeing right now.”
