Odd Lots · Thursday, August 27, 2026
Kansas City Fed President Jeffrey Schmid views the current labor market as undergoing a significant structural change due to the retirement of baby boomers. He estimates about 4 million people per year are retiring, which creates both opportunities and a loss of 'intellectual muscle,' challenging the Fed to find ways to transfer knowledge to younger workers, potentially through AI.
“So I think about last year, I dissented a couple as a voting member of FOMC. I talked a lot about last year, still do talk about, that the labor force is going through a very fascinating structural change. I mean, people in my generation, the baby boomers, I mean, we're retiring at about 4 million people per year.”
“So what that does is that challenges my 25, 35, 45-year-old Fed economist and banker saying, look, how do we think about what the job entails? And how do we use AI to transfer what the 65-year-old retiree knows to what they need to know now, not wait till they're 55 or 65?”