Below is the transcript of Betsey Stephenson's interview on Face the Nation Sunday, June 5, 2022.

MARGARET BRENNAN : Betsey Stevenson, University of Michigan, is joining us now. Her previous duties included being the Department of Labor's chief economic officer under President Obama. She is now in Ann Arbor. Betsey, welcome at Face The Nation

FRANKLIN STEVENSON, CHIEF ECONOMIST IN THE UNITED STATES LABOR DEPARTMENT: Good morning. It's a pleasure being here.

MARGARET BRENAN: We have seen more people returning to the workforce. This is evident in the job number we just received. The participation rate has returned to nearly the same level as before the pandemic. However, you have pointed out that there are still problems with child-care and nursing in some of these caregiving roles. What does this mean to you?

STEVENSON : Yes, it's true. However, we haven’t seen all of the jobs return in the services sector. There have been some job gains in the goods-producing sector as well as in the services sector (health care, education, and caregiving). However, not everyone has been hired back. This could be because people have been slow to return to the desire to use those services. It could be that it is difficult to find people who are qualified to do those jobs.

MARGARET BRENNAN : I would like to ask you a question about inflation and the risks it poses to the economy. Jamie Dimon, JP Morgan's chief economist, stated that the hurricane was coming towards us a few days back. It's not clear if this is a superstorm Sandy or a minor hurricane. You need to be ready. What should consumers prepare for?

STEVENSON : You know what everyone wants? That consumers slow down their spending. This would reduce some of the price pressure. The Feds are raising rates in hopes that consumers will spend less. All the accusations about how much stimulus spending contributed, but it really comes down to do we give too much money to people, who are in the best financial position they have ever been. The result is that the demand is slightly outstripping the supply. If people decided to stop pulling back, the Fed would have less work. It's great, I think. It's kind of what we should do. We don't have stop job growth to stop inflation. In fact, it might be a mistake to stop job growth and push ourselves into a recession. But that's not the point. What we need is to get demand down while supply continues to grow.

MARGARET BRENAN: Let's just go back to what you said about fiscal spending. This is some of the congressional money that was used to address the problem, the emergency funding. Are you of the opinion that President Trump and President Biden should have had different structures? Do they have to send checks home to their constituents? Is that the real flaw of the deal?

STEVENSON : I think there is a bit of a half-full view here. When they created the American rescue plan, there was 6.4% unemployment. It was predicted by most that it would be a lot like 2008. It took eight years for unemployment to fall below 4% in 2008. The Congressional Budget Office predicted that it would take six years to achieve this. It would take until 2026. The idea was to ensure that families and businesses are supported in order to have the best economic recovery ever. That was what we did. We have added 7.3 millions jobs since the American rescue plan was passed. Problem was that things happened faster than we expected. We can now look back and ask ourselves if we could have done the exact same thing with slightly less spending. Maybe? Maybe not. Perhaps we would be facing a situation where there is 5% unemployment and millions of people working today. It would still be on the sidelines. That's something that nobody wants. We wanted to get back where we were before. It's clear that Congress' fast actions, starting at the start of the pandemic and ending with the American rescue plan, are the reason we have the rapid recovery we have now. Yesterday's labor report showed that Americans have more options than ever to find the right job, and that they are being hired at extremely high rates. We've also seen that the household incomes for the lowest income bracket have increased by almost 12%, even after we adjust for inflation. If you were to ask me, would we have done that? We should have done that for most families. They're better off, and they know it. We are afraid of-

MARGARET BRENNAN: Well,--

STEVENSON: We see rising prices. We want to know how long it will take for prices to rise.

MARGARET BRENAN: exactly as-

STEVENSON: This good time can last.

MARGARET BRENNAN : -And that's why I am asking you this question. The Fed can quickly act here to try and cool down the situation. They can't stop the conflict in Ukraine. They cannot stop COVID. Are consumers aware that high prices will continue to be a part of the future?

STEVENSON - Well, I believe what we want. However, I don't think that we should assume that high prices will remain in place for the foreseeable future. The Fed will take action. I believe they will bring prices down. However, they won't be able to lower relative prices. Gas will still be very expensive relative to other commodities. This will continue until we end the war in Ukraine. Look, gas prices have risen $1.50 per gallon since Putin began to build troops at the border. This can't be reversed by the Fed. The Fed can't reverse that.

MARGARET BRENNAN : Betsey Stevenson, thank you for your analysis. We'll be back shortly.