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Re: U.S. Economy Shrinks By Most Since Great Recession in 1Q
Several points:
While retirements explain part of the drop in labor force participation, one can't conclude that most or all of the drop is benign. At least some share of people who are pursuing education might actually have a preference of working. Education, of course, should provide them with greater labor market flexibility.
Most importantly, even as total employment is approaching pre-Recession levels (the recession began in 2007 Q4), a number of indicators remain quite problematic. Data related to the duration of unemployment, the share of long-term unemployed, broader unemployment measures, and information about people not in the labor force remain notably worse than they were just prior to the recession. Put simply, structural unemployment (jobs-skills mismatch) is greater than it was prior to the recession. Structural unemployment is more difficult to address than cyclical unemployment, as it has causes that go beyond the strength of the economy. Some of its remedies are long-term in nature e.g., education/training, and those remedies depend, in part, on fiscal investments that can be constrained by overall fiscal realities (e.g., deficits) and priorities.
Select data:
Why is it bad that the workforce participation rate is lowest in years?
That just means that we have a larger percent of our workforce that is financially secure enough that they don't have to work. Some of those people are in college, or retired, or have decided to be housemakers or stay at home moms and dads. Thirty years ago, back when conservatives talked about things like "values" and "family" and "education", those were thought to be good things, but now conservatives seem to be the anti-values/family/education party.
Also, if todays workforce participation rate is still higher than at any point prior to 1978, so in a way we are returning to the "good ole days".
PS - I believe that I read that as of last month all jobs lost during the Great Bush Recession had been recovered and that we now have a record number of jobs in the USA.
Several points:
While retirements explain part of the drop in labor force participation, one can't conclude that most or all of the drop is benign. At least some share of people who are pursuing education might actually have a preference of working. Education, of course, should provide them with greater labor market flexibility.
Most importantly, even as total employment is approaching pre-Recession levels (the recession began in 2007 Q4), a number of indicators remain quite problematic. Data related to the duration of unemployment, the share of long-term unemployed, broader unemployment measures, and information about people not in the labor force remain notably worse than they were just prior to the recession. Put simply, structural unemployment (jobs-skills mismatch) is greater than it was prior to the recession. Structural unemployment is more difficult to address than cyclical unemployment, as it has causes that go beyond the strength of the economy. Some of its remedies are long-term in nature e.g., education/training, and those remedies depend, in part, on fiscal investments that can be constrained by overall fiscal realities (e.g., deficits) and priorities.
Select data: