Treasury Secretary Yellen says the stimulus bill will get the economy back on track 'quickly,' with near full employment next year

• Treasury Secretary Janet Yellen said Sunday that the US could see full employment next year.
• The risk of inflation remains small and "manageable," she told ABC News on Sunday.
• Full employment does not mean zero unemployment, but it would reflect a healthier economy.

The US could return to full employment in 2022, Treasury Secretary Janet Yellen said on Sunday, renewing her forecast now that the Biden administration's coronavirus pandemic relief package has been signed into law.

"I am hopeful that if we defeat the pandemic, that we can have the economy back near full employment next year," Yellen said in an interview with "This Week" on ABC News.

Yellen said last month that the US economy could see such a recovery, but that it would hinge on whether President Joe Biden's bill - which includes direct payments for individuals, an expansion of the child tax credit, and funding for vaccine distribution and testing - was adopted.

The bill passed the Senate earlier this month in a 50-49 vote, and the House last week in a 220-211 vote.

It marked the administration's first major win, and comes as millions of Americans are struggling as the coronavirus pandemic has devastated parts of the economy in the past year. The Trump administration passed relief packages last year, offering direct payments to taxpayers among other aid to individuals.

"I believe there is enough support in this package to relieve suffering and to get the economy quickly back on track," Yellen, the former head of the Federal Reserve who was confirmed in January as Treasury Secretary, said Sunday.

"Full employment" does not mean a state of zero unemployment, but such conditions would reflect a US economy that is far healthier than where it is today as the unemployment rate remains at levels elevated compared to previous years.

Full employment essentially refers to "the level of employment at which virtually anyone who wants to work can find employment at the prevailing wage," according to the Federal Reserve Bank of Richmond.

The Bureau of Labor Statistics said earlier this month in the latest jobs report that the US unemployment rate fell to 6.2% from 6.3%.

Still, that figure does not capture the breadth of how many people are out of work. The U-6 unemployment rate, which the government defines as workers who are marginally attached to the labor force and others who are employed part-time, was 11.1% in February, the BLS said.

Yellen acknowledged that a bump for the economy means prices could rise for consumers, but not in an extreme way. Some experts have said the economy is not at risk of overheating, but that rising demand will lead to higher prices.

"Is there a risk of inflation? I think there's a small risk. And I think it's manageable," Yellen said on Sunday, adding that prices could move up after falling last spring when the pandemic started to grip the US, but that it would be "temporary."

"To get a sustained high inflation like we had in the 1970s - I absolutely don't expect that," she said.

Some on Wall Street are optimistic about what the relief package means for the economic recovery. Goldman Sachs economists told clients earlier this month that the US employment rate could drop to 4.1% by year-end thanks to a combination of the stimulus package and coronavirus vaccines rolling out.

"Despite the surprising speed of recovery early on, we are still very far from a strong labor market whose benefits are broadly shared," Federal Reserve Chair Jerome Powell said last month.