The Omicron variant will weigh on the economic growth of the United States (EU) in the coming months, but will not derail it, Treasury Secretary Janet Yellen said Wednesday during a meeting in Washington with mayors of that country.
“Yes, Omicron has presented a challenge and will probably affect some of the data in the coming months, but I am confident that it will not derail what has been one of the strongest periods of economic growth in a century,” Yellen said.
“None of this was guaranteed. I think it’s important that we recognize it,” he added when appearing before the US Conference of Mayors.
According to the Treasury secretary, there is “a misconception that Omicron has derailed our recovery; a scenario in which the new variant has returned our economy to the state it was in on the day of the inauguration (of the president)”, in January 2021.
The Omicron variant has caused an increase in infections and quarantine cases, preventing Americans from working. Airlines, for example, have canceled thousands of flights since Christmas due to staff shortages.
As a result of rising virus cases, economic growth will slow in the first quarter of 2022, economists forecast.
Yellen insisted that the American Rescue Plan, approved by Congress in March 2021, “acted as a vaccine for the American economy, protecting our recovery from the possibility of new variants.
“The protection was not complete, but it was very strong, and it spared communities from the most severe economic effects of Omicron and (the former variant of concern) Delta,” he said, noting that $350 billion in funding from emergency to local governments.
In effect, the first year of the pandemic “decimated government budgets” and forced mass layoffs and the collective furlough of around 1.3 million workers.