Fed’s Kashkari says wages will rise when labor is truly scarce

Andrew Harrer | Bloomberg | Getty Images

Neel Kashkari, president and chief executive officer of the Federal Reserve Bank of Minneapolis.

Minneapolis Federal Reserve Bank President Neel Kashkari said on Tuesday he finds it hard to believe that the US economy is in danger of overheating when wage growth is so low.

US unemployment is at 4.4 percent, below what most economists believe is consistent with full employment, and is one data point Fed policymakers cite when they explain why they have been raising interest rates, which Kashkari has opposed.

“It can’t be that bad to find workers,” Kashkari told the Minnesota Women’s Economic Roundtable, adding that while he realizes there are complicating factors like the need for certain skills, when businesses really need workers they will raise wages. “We are not seeing wages climbing.”