Julia Pollack Talks Jobs

Summary

Bloomberg Talks – Julia Pollack Talks Jobs

Date: December 16, 2025
Guest: Julia Pollak, Chief Economist, US Department of Labor
Host/Interviewer: Bloomberg

---

Episode Overview

This episode of Bloomberg Talks features Julia Pollak, Chief Economist at the US Department of Labor (and former Chief Economist at ZipRecruiter), for an in-depth conversation on the state of the US labor market. Pollak addresses recent jobs data, the impact of governmental policies and economic disruptions, the outlook for employment growth, youth unemployment, and the future-facing effects of artificial intelligence and policy coordination. Her perspective offers listeners insights into how recent shocks and ongoing initiatives may shape the jobs landscape in 2026 and beyond.

---

Key Discussion Points & Insights

The State of the US Labor Market

• Context on Recent Data Distortions
  Pollak argues that the most recent jobs report is skewed by two specific, temporary effects:

  • Over 10,000 federal workers have transitioned off payrolls—some entering temporary "frictional unemployment."
  • The "Schumer shutdown" displaced about 900,000 federal workers, which also led to stoppages among federal contractors.
    Quote:

  "This report overstates, understates the strength of the labor market right now because there are two huge temporary distortions at play in the data..."
  —Julia Pollak (01:27)

• Anticipated Recovery
  Pollak expects that as these effects fade, the unemployment rate will "jump back down very soon."
  (01:27-02:07)

Youth Unemployment & Macro Policy

• No Immediate Alarm on Youth Unemployment
  The youth unemployment rate is reportedly at the same level as early in the Trump administration, despite recent noise.

  • Pollak acknowledges a larger challenge now due to "Biden inflation hangover" and the subsequent Fed rate hikes.
    Quote:

  "We have a bigger challenge this time because of the Biden inflation hangover, which forced the Fed to slam the brakes on the economy."
  —Julia Pollak (02:14)

• 2026 Economic Comeback
  Pollak is optimistic about a "huge comeback" starting in 2026, referencing the "One Big Beautiful Bill Act" and its stimulative policies:

  • "Full and accelerated expensing for business investments"
  • "No tax on tips, no tax on overtime"
    Quote:

  "We are setting the stage for a huge comeback in 2026 and beyond."
  —Julia Pollak (02:34)

Federal Reserve Policy and Economic Outlook

• On Rate Cuts and Market Expectations
  The panel discusses whether the Fed needs to cut rates soon. Pollak notes:

  • Slower job growth from mid-2022 to mid-2024 was due to high interest rates.
  • Current rates are "still restrictive" and hurting parts of the economy.
    Quote:

  "Rates right now are still restrictive and they are still a problem for, for much of the economy."
  —Julia Pollak (03:45)

• Dual Mandate and Non-inflationary Growth
  The Fed's dual mandate (employment and price stability) is achievable, according to Pollak, through “deregulation” and “reshoring incentives.”
  Quote:

  "This president has shown that his policies deliver both. ... Through deregulation, through reshoring incentives, we're going to see this labor market take off again and in a non inflationary way."
  —Julia Pollak (04:21)

Revitalizing US Manufacturing

• Reshoring, Tariffs, and Job Growth
  The administration hopes that reshoring, tariffs, and construction investment will revitalize Midwestern manufacturing and the “American dream.”
  • The latest data shows the largest construction jobs increase in over a year, signaling coming growth in manufacturing employment.
    Quote:

  "This latest report shows the largest increase in construction jobs in over a year. And that's really the front end of those investments..."
  —Julia Pollak (05:23)

Artificial Intelligence and the Future of Work

• AI’s Effect on Labor
  Pollak points to an AI-driven demand spike for skilled trades, advanced manufacturing, and workers with AI expertise.

  • The Labor Department is focused on aligning labor and education policy—offering “job-connected training” over expensive, less-job-ready degrees for the first time. Quote:

  "The AI boom is driving huge demand for workers in the skilled trades, in advanced manufacturing, and of course workers with AI skills."
  —Julia Pollak (06:32)

  "For the first time, labor policy and education policy are pulling in the same direction. We've aligned labor and education for the first time ever."
  —Julia Pollak (06:32)

Bureau of Labor Statistics (BLS) Leadership

• Personnel and Nominations
  The conversation briefly turns to the vacant BLS Commissioner role.

  • Pollak demurs on whether she's up for the post, indicating that's up to the President.
  • She does, however, underscore the priority of “aggressive labor market data modernization” focusing on real-time, accurate, learner- and worker-centric data.
    Quote:

  "I have at the Labor Department made it my priority to push forward a very aggressive labor market data moder agenda that puts workers and learners first and gives them more access to the data collected on them."
  —Julia Pollak (07:31)

  "Whoever comes in [as BLS Commissioner] has very clear mandate from the President to put workers and learners at the center ... to change the data paradigm to a real time data paradigm and to make sure that the data is accurate and has the utmost integrity."
  —Julia Pollak (08:22)

---

Memorable Quotes & Moments with Timestamps

• On recent jobs data distortions:
  “This report overstates, understates the strength of the labor market right now because there are two huge temporary distortions at play in the data here.”
  —Julia Pollak (01:27)

• On the post-pandemic economic challenge:
  “We have a bigger challenge this time because of the Biden inflation hangover, which forced the Fed to slam the brakes on the economy.”
  —Julia Pollak (02:14)

• Setting up for a jobs comeback:
  “We are setting the stage for a huge comeback in 2026 and beyond.”
  —Julia Pollak (02:34)

• On restrictive rates:
  “Rates right now are still restrictive and they are still a problem for, for much of the economy.”
  —Julia Pollak (03:45)

• On the dual mandate success:
  “This president has shown that his policies deliver both. ... Through deregulation, through reshoring incentives, we're going to see this labor market take off again and in a non inflationary way.”
  —Julia Pollak (04:21)

• AI and workforce development:
  “For the first time, labor policy and education policy are pulling in the same direction. We've aligned labor and education for the first time ever.”
  —Julia Pollak (06:32)

• On labor market data modernization:
  “I have at the Labor Department made it my priority to push forward a very aggressive labor market data moder agenda that puts workers and learners first and gives them more access to the data collected on them.”
  —Julia Pollak (07:31)

---

Notable Segment Timestamps

• Overview of jobs report distortions: 01:27–02:07
• Youth unemployment and economic policy: 02:07–02:34
• Stimulus policies and 2026 outlook: 02:34–03:06
• Fed interest rates and employment: 03:45–04:16
• Reshoring and construction job growth: 05:23–05:47
• Impact of AI on workforce and training: 06:32–07:13
• BLS Commissioner discussion and data agenda: 07:23–08:43

---

Episode Takeaways

• Recent jobs data are not as weak as headlines suggest—temporary distortions skew the numbers.
• Policymakers are betting on stimulative measures and infrastructure spending to drive job growth, especially in construction and manufacturing.
• AI is poised to reshape the labor market, creating demand for skilled trades and tech talent, with policy now aligning labor and education priorities.
• Labor market data modernization is a focal point for future BLS leadership, with real-time, worker-centric information as a top goal.
• Overall, Pollak projects cautious optimism for the US jobs market, seeing potential for a robust recovery by 2026.

Transcript

[IU Marketing/Okta Advertiser]

Old playbooks won't solve tomorrow's problems. Indiana University is proving how higher education can create solutions with industry. Our partnerships address future talent and workforce needs, support entrepreneurs and local businesses, and create solutions that turn discoveries into dollars. Together, we're building a model for industry partnerships that fuel economic growth. Explore IU's impact at iu.edu impact.

[Bloomberg Host]

Bloomberg Audio Studios Podcasts Radio news hey, we talked about the market, the U.S. jobs market earlier with Michael McKee. It's sluggish, not rapidly deteriorating. And we did see that data that came out saw traders refraining from boosting bets on near term Fed rate cuts, setting stocks lower and bonds wavering. So we're not, you know, it's not like all of a sudden traders are saying, okay, we're going to get more rate cuts because of that Labor Day that we got this morning.

[Bloomberg Interviewer]

Yeah, a reduction fully priced in by mid next year, you should know. But we're not seeing those bets go up.

[Bloomberg Host]

No. Exactly. Curious to see what our next guest has to say specifically about the US labor market, let's head to the Bloomberg News Bureau in D.C. to someone well known to our Bloomberg audience, she was formerly chief economist over at ZipRecruiter. She is Julia Pollack and she's chief economist for the US Department of Labor. Julia, good to have you back here on Bloomberg. How worried are you about rising unemployment?

[Julia Pollak]

I'm not. So this report overstates, understates the strength of the labor market right now because there are two huge temporary distortions at play in the data here. The first is 10000 or more federal workers who took the fork and came off payrolls. And some of them have gone into temporary frictional unemployment. And the second big distortion in this report is the Schumer shutdown, which forced 900,000 federal workers off the job, but it also led to weakness in the private sector because it forced work stoppages for federal contractors, temporary layoffs there. So I expect the unemployment rate to jump back down very soon.

[Bloomberg Interviewer]

What about the youth unemployment rate, the rising and rising youth unemployment? Are you concerned about that?

[Julia Pollak]

So you know, the unemployment rate is exactly where it was when President Trump first took office in his first term. And he has a track record of bringing it all the way down to 3.5%. We have a bigger challenge this time because of the Biden inflation hangover, which forced the Fed to slam the brakes on the economy.

[IU Marketing/Okta Advertiser]

Economy.

[Julia Pollak]

And that has hurt marginal workers the most. But we are setting the stage for a huge comeback in 2026 and beyond. With the one big beautiful bill act which has hugely stimulative policies. And you'll see those macro stimulative effects build into 2026. They are things like, like expensing fast and accelerated, full and accelerated expensing for business investments. No tax on tips, no tax on overtime. No.

[Bloomberg Host]

So, so Julie, if I may just jump in just because we only have about five minutes left here. So it sounds to you like that there's, and we've heard this certainly from guests here on Bloomberg, more liquidity coming into the market, things to support economic growth. It sounds like you said that the labor picture is actually better than what the data showed. So it sounds to me then that the Fed is correct, Jay Powell is correct in being or you know, actually forgive me, what you're sounding like you're saying is that maybe the Fed doesn't then ultimately to be cutting rates, that things actually look pretty rosy for 2026.

[Julia Pollak]

So I think the reason that employment growth, the job growth slowed so dramatically between mid-2022 and mid-2024 is that rates were high. And the longer rates stay restrictive, the more of the economy gets hurt. The more businesses have to refinance at double the rate, the more families go out there and try to buy a home and find that it's just unaff. Rates right now are still restrictive and they are still a problem for, for much of the economy.

[Bloomberg Host]

But you said you were, you said you weren't concerned about rising unemployment. So I'm a little confused.

[Julia Pollak]

Well, the Fed has a dual mandate, full employment on the one hand and, and price stability. And this president has shown that his policies deliver both. In the first Trump administration we had non inflationary growth and, and you can do that with policies that don' fuel on the fire of demand and restrict supply, but do the exact opposite. So through deregulation, through reshoring incentives, we're going to see this labor market take off again and in a non inflationary way.

[Bloomberg Interviewer]

Well, on the reshoring part of this motivation for reshoring, on shoring, imposing tariffs to bring back the Midwest, to revitalize what many consider the American dream. Secretary Besson has said it's been harmed by global trade, the manufacturing industry, that though it keeps shedding workers, when can we expect the data to reflect progress that the administration is trying to make in restoring that American dream?

[Julia Pollak]

So the economy shed manufacturing jobs for about two years before President Trump took office. Again, this latest report shows the largest increase in construction jobs in over a year. And that's really the front end of those investments in mining and energy and manufacturing. And they're a signal that manufacturing job growth will pick.

[Bloomberg Host]

So, okay, you know, you look at the labor market, I mean in terms of initiatives that will potentially help the US labor market, you know, the conversation around artificial intelligence, Fed Chair Jay Powell even addressed it and saying it hasn't impacted US jobs yet. So I'm just curious, how are you factoring that into, as you look at some of the upcoming moves, the President ramping up in terms of hiring people to really focus, focus on technology, specifically in the administration, so looking to make more investments so that the US certainly has a dominant role. I'm just curious how then you factor that into your estimates for the impact on the US labor market.

[Julia Pollak]

Well, the AI boom is driving huge demand for workers in the skilled trades, in advanced manufacturing, and of course workers with AI skills. And it is our job at the Labor Department to ensure that US workers are prepared for those jobs of the future. For the first time, labor policy and education policy are pulling in the same direction. We've aligned labor and education for the first time ever. And we are now focusing very heavily on getting workers access to job connected training that sets them up for in demand jobs and that doesn't push them to expensive degrees that leave them with nowhere to go.

[Bloomberg Interviewer]

Let's talk personnel a little bit. We're curious about why it's taking so long to make another nomination as BLS commissioner. Is your name in the ring? Is your hat in the ring?

[Julia Pollak]

I have no idea. You'd have to ask the President that.

[Bloomberg Interviewer]

Would you, if you were asked, would you service that?

[Julia Pollak]

Well, I, I think there is tremendous amount of work to do there, tracking AI's labor impact, improving the timeliness, the granularity, the accuracy of, of the data. And I have at the Labor Department made it my priority to push forward a very aggressive labor market data moder agenda that puts workers and learners first and gives them more access to the data collected on them. So right now I love partnering with the BLS on all of those kinds of initiatives and I am happy to serve in whatever role the President sees fit.

[Bloomberg Interviewer]

If we're thinking just 30 seconds. But if we're thinking about previous commissioners, how will this nominee or this next commissioner be different? Just 20 seconds.

[Julia Pollak]

I have no idea. But I think whoever comes in has very clear mandate from the President to put workers and learners at the center of what we do, to change the data paradigm to a real time data paradigm and to make sure that the data is accurate and has the utmost integrity.

[Bloomberg Host]

All right, Julia. Thank you so much. Julia Pollock, Chief economist for the U.S. department of Labor.

[IU Marketing/Okta Advertiser]

These days, it seems like AI agents are just about everywhere. You turn every field and every function. But without identity, you can't trust they'll serve your business instead of jeopardy, jeopardizing it. Fortunately, Okta helps you get identity right by securing your AI Agents identities, giving you a single layer of control, a single standard of trust. So whether an AI Agent supports a single user or your entire enterprise, with Okta, you'll turn risk into opportunity. Secure every agent, Secure any agent. Okta secures AI.