Washington, DC CNN  —  US inflation is down considerably from a four-decade high reached nearly two years ago. Now, as the Federal Reserve faces the final stretch of its historic inflation battle, a bigger pool of workers could slow inflation even further. That would also improve the chances of a “soft landing,” an extremely rare scenario in which inflation is tamed without triggering a recession. “A big part of the story on inflation has been supply,” San Francisco Fed President Mary Daly said recently at the annual National Association for Business Economics policy conference. “The supply-side surprise, if you will, has been the positive news on labor and productivity.” America’s job market last year was solid, with employers hiring at a strong clip, unemployment remaining low and more workers trickling back into the workforce. Labor force participation, or the share of the working-age population that is employed or actively seeking a job, dropped off sharply in the beginning of the Covid-19 pandemic for reasons such as early retirements or people not working due to fears of contracting Covid. It began to recover shortly after, but participation jumped last year. “We had tremendous growth in labor supply last year, and if you look at last year and 2022, those were the two strongest years of labor force growth in a row going back to the early 1980s,” Sarah House, senior economist at Wells Fargo, told CNN. “That was hugely important in reducing pressure on wages and labor costs, but at the same time, allowing employers to hire therefore putting more money in consumers’ pockets,” she said. That then begs the question: How much more can better labor supply slow inflation? There is still room for improvement, economists say, but it’s not clear if those gains will be enough to tug inflation all the way to the Fed’s 2% target. “I think that the labor force story can last through 2024. It will not be as strong as it was in 2023 and 2022, but nevertheless, we think that will help pull inflation lower,” Michael Gapen, chief US economist at Bank of America, told CNN. It took some time for workers to return from the sidelines, and throughout 2021, economists theorized why some people weren’t back at work, blaming excess pandemic savings or a deterioration of work ethic “The job search process itself is not frictionless; it may take workers some time to find a good job,” The White House’s Council of Economic Advisers explained in an analysis last year. “Also, if households adapted to the pandemic in ways that can take a while to unwind (such as giving up formal child care), this would delay the labor supply response to growing demand.” Indeed, demand was strong in 2023 as Americans opened their wallets for both goods and services — a remarkable display of resilience in the face of the highest interest rates in two decades and recession fears that materialized after some banking stresses in the spring. That meant employers had the revenues to hold onto their workers and hire. Immigration into the United States also ramped up in 2023. Government officials issued more than 192,000 employment-based immigrant visas, which was “far above the pre-pandemic number and for the second year running ensured that no available visas went unused.” Still, participation remains below levels seen before the pandemic. It stood at a 62.5% rate in January, down from the 63.3% in February 2020. That’s still a sizable gap considering that just one percentage equals more than a million workers. Improving labor supply might slow inflation further only “incrementally” this year, and weaker demand, which is what the Fed aims to do through interest rate increases, could play a bigger role in reining in inflation, House added. Top soccer clubs are using an AI-powered app to scout future stars A London-based technology company is looking to “democratize” talent identification and scouting in soccer using a mobile app, reports my colleague Jack Bantock. Free to download and available globally, the aiScout app allows aspiring soccer stars to enter virtual trials for professional clubs by uploading self-recorded footage of themselves completing a series of drills. It offers 75 exercises, designed to test a range of skills, with videos showing users how to complete them. Performances are automatically scored by artificial intelligence (AI) technology. The data can then be accessed by clubs, allowing their scouts to peruse scores for viable talent, honing their search with a variety of filters, from age and gender to position on the pitch. The app currently has two English Premier League (EPL) partners, Chelsea and Burnley, and clubs can tailor their in-app trials to meet specific needs and set their own benchmarks by having their academy players complete the same drills. “We’re putting that data up front to make better use of [the scouts’] time,” said Richard Felton-Thomas, chief operating officer of ai.io, the company behind the app.“To say [to scouts], ‘Go over to this place today because there’s three players in that game that are all actually beating your Chelsea standard’ — that’s going to be the best use of your time.’” Read more here. Up Next Monday: Philadelphia Fed President Patrick Harker delivers remarks. Tuesday: Earnings from Target, Ross and Nordstrom. S&P Global and the Institute for Supply Management release February business surveys gauging economic activity in the US services sector. The US Commerce Department releases January figures on new orders for manufactured goods. Fed Vice Chair for Supervision Michael Barr delivers remarks. Wednesday: Earnings from JD.com, Campbell Soup, Abercrombie & Fitch, Foot Locker and Victoria’s Secret. Fed Chair Jerome Powell testifies before the US House Financial Services Committee. The Bank of Canada announces its latest interest rate decision. The US Labor Department releases January figures on job openings, quits, hires and layoffs. San Francisco Fed President Mary Daly delivers remarks. China’s customs agency releases trade data for the first two months of the year. Thursday: Earnings from Broadcom, Costco, Kroger, Burlington, DocuSign, Gap, American Eagle Outfitters and Potbelly. Fed Chair Jerome Powell testifies before the US Senate Committee on Banking, Housing, and Urban Affairs. The European Central Bank announces its latest interest rate decision. The US Labor Department reports the number of new applications for jobless benefits in the week ended March 2. The US Commerce Department releases January data on trade flows. Cleveland Fed President Loretta Mester delivers remarks. Friday: The US Labor Department releases February data gauging the state of the US labor market, including monthly job growth, wage gains and the unemployment rate. China’s National Bureau of Statistics releases February inflation data.