There has been an abundance of column inches
devoted to the weak job recovery following the Great Recession. Analysts from the left
and right have
offered opinions about why employment didn’t spring back after the
official end of the downturn in July of 2009.
But what many
have missed is that this phenomenon isn’t new. In the three most recent economic downturns the US job
market has been noticeably less fluid than in earlier times. Unemployment – after the recessions of
1990, 2001, and 2007 – was slow to rebound, and in all three cases
continued to increase even after the end of the economic contraction.
This is in stark contrast to our earlier postwar recessions
as illustrated clearly in the graph at the top.
In those instances joblessness fell as soon as the economy began
to grow.
Are these trends just a coincidence? Or has something structural
changed?
The good news is that, although a jobs recovery didn't shift into gear immediately after 1990 and 2001, unemployment did eventually follow the
typical pattern of a post-recession precipitous drop.
If that’s an indication of our current situation then I’m
hopeful that the talk of a jobless recovery is misguided.
Nevertheless it’s an interesting trend that likely has
meaning. I’ll look into it further
and write again when I learn more.
No comments:
Post a Comment