“Jobless” Recovery — The New Norm?

Cumulative Increase in Unemployment Rate From Beginning of Recession to 30 Months Out (Federal Reserve Bank of Cleveland)

The present recession “will likely be the longest since 1945,” and “is also already associated with the largest drop in payroll employment of any US recession and the biggest jump in the unemployment rate.”

As for the rapidity of recovery, “recent recessions have been followed by exceptionally slow recoveries in the labor market, and the current recession is shaping up to follow in the same pattern.”

So judges Murat Tasci, a research economist with the Federal Reserve Bank of Cleveland, as he asks Are Jobless Recoveries the New Norm? This seven-page paper compares the present recession to those of the past 65 years, concluding that “the negative effects of this recession are likely to linger a while in the labor market” and that the existent “significant underemployment could be a major contributor to a jobless recovery.”

Real Gross Domestic Product and Unemployment in Postwar Recessions (Federal Reserve Bank of Cleveland)

Published in: on March 26, 2010 at 3:02 pm  Leave a Comment  

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