Mohamed El-Erian, former Chief Executive Officer and co-CIO at Pimco and columnist for Bloomberg View, spoke with Bloomberg TV’s Betty Liu about the U.S. economy, markets and the departure of Pimco co-founder and Chief Investment Officer Bill Gross.

El-Erian on Bill Gross's Departure: I was Very Surprised [TRANSCRIPT]

El-Erian said: “His departure — the fact that it happened and how it happened — was a surprise. What was not a surprise was the bench and a strong team led by Dan Ivascyn. They are superb.”

El-Erian also spoke about broader economic issues and why we haven’t seen any wage growth, saying “I think people are starting to realize that this is a different economy. In addition, little steps that should be taken, the minimum wage, et cetera, are not being taken. And that’s part of a bigger problem that we don’t have a holistic policy response as yet because of the polarization of Congress.”

El-Erian: Surprised by Manner of Gross Exit From Pimco

BETTY LIU: Well for more reaction on the jobs data I want to bring in Bloomberg View columnist and former PIMCO CEO, Mohamed El-Erian, who joins us a little jetlagged from London. Mohamed, great to see you this morning. Look, you went through the jobs report yourself. And how do you think the Fed is going to interpret this? Does this at all change Janet Yellen’s schedule on interest rates?

MOHAMED EL-ERIAN: I don’t think so. It is the mirror image of the report we talked about a month ago. This time around it is the headline numbers that are really encouraging. If you add the job creation plus the revisions you’re looking at almost 320,000 new jobs. That’s taken the three-month average to 224,000. That’s really good. And the unemployment rate is down.

But on the other hand, the internals this time around are less encouraging, particularly long-term unemployment stuck at three million, youth unemployment up to 20 percent, and of course the participation rate is coming down. So net-net this is a mixed report. And the most disappointing aspects, Betty, is one that you’ve been talking about for the last half hour, which is wage growth. Wage growth simply is not there yet.

LIU: It isn’t there yet. And do you have any further clarity or explanation as to why? With the labor market tightening we haven’t seen wage growth escape at all.

EL-ERIAN: I think this is a different economy. And I think people are starting to realize that this is a different economy. In addition, little steps that should be taken, the minimum wage, et cetera, are not being taken. And that’s part of a bigger problem that we don’t have a holistic policy response as yet because of the polarization of Congress.

LIU: And given that, we’ve seen, Mohamed, more market volatility, right? Do you expect that if we continue to get numbers like this where it kind of shows a mixed picture that this volatility is only going to increase?

EL-ERIAN: I think volatility will increase, Betty, but for a different reason. We are living in a world in which the main policymakers, the central banks, have gone from a multispeed world, where they were doing the same thing but at different speeds, to a multitrack world where they’re doing different things. And the result of that is that currencies are on the move. And when currencies move sharply they tend to transmit volatility to other markets. And that’s what I think we’re going to see more of looking forward.

LIU: And speaking about volatility, Mohamed, if I may change topics for a moment, of course we’ve seen a lot of volatility at your former firm, PIMCO. This is the first time, Mohamed, that you and I are speaking and you’re speaking anywhere really about PIMCO since Bill Gross left a few weeks ago. He started his job at Janus. Were you as shocked as everybody else with Bill Gross leaving PIMCO?

EL-ERIAN: Yes. I was very surprised, but what I wasn’t surprised about, Betty, is that they were able to draw on a very deep bench of talented people who have established track records, who have industry awards and who have been part of the process. They’ve been managing more than 80 percent of the assets at PIMCO.

So Bill’s departure, both the fact that it happened and how it happened was a surprise, but what wasn’t a surprise was the incredible bench and a very strong team led by Dan Iverson. I’ve worked with these people. I know them really well. They are superb and Dan Iverson is superb as a leader.

LIU: Well speaking about Iverson and his team, we spoke with Bill Powers who’s a former PIMCO managing director, someone you know as well, Mohamed. And this is what he said about the bench at PIMCO.

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LIU: Mohamed, would you agree?

EL-ERIAN: So Bill is absolutely right. If I started listing you people who are absolutely exceptional at PIMCO we’d be here for the next two hours. Let me give you one story that I think speaks to the depth.

A few years ago Scott Simon, head of the mortgage desk, retired. And one of the services, Morningstar, wrote the following, said if Scott had been at any other firm this would have been the star investor retiring. But Scott was at PIMCO and he was surrounded by other star investors. And that is why it’s less of a news. And the fact is it’s a very deep bench and it’s a very talented bench.

LIU: And it certainly has many ace players, Mohamed, including you when you were running the firm. Do you have any interest in ever going back to PIMCO to run as CEO, given that Bill Gross is now gone?

EL-ERIAN: I’m really happy with what I’m doing right now because not only do I have this portfolio of activities, but in addition I get to spend a lot more time with my daughter, which is something that I really wanted to do. And that’s my main focus, Betty.

LIU: All right. Mohamed, I know you spent the summer traveling Italy or Europe throughout with your daughter, Mohamed, and same with me. We’ve got much more on the economy and the jobs report with Mohamed El-Erian, the former PIMCO CEO. And we’ve got Austan Goolsbee joining us in just a few moments, the former White House Counsel of Economic Advisers under President Obama.