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From a Bloomberg article today:
quote
Deeper recessions and more gradual recoveries will be the norm rather than the exception as the U.S. workforce grows at a slower pace, according to economists on the panel that determines when slumps begin and end.
The typical contraction “will have steeper declines and slower recoveries in output and employment,” according to a paper by Harvard University’s James Stock and Princeton University’s Mark Watson presented today at the Brookings Panel on Economic Activity inWashington. “We can expect recoveries from future recessions to be ‘jobless’ as well,” they said, similar to the two most recent rebounds.
The economists, who are members of the National Bureau of Economic Research’s business cycle dating committee, found the severity, length and aftermath of the 18-month slump that ended in June 2009 were predictable based on comparisons with past downturns.
Employment Gains Smaller
In the first eight quarters of the rebound that began in June 2009, the world’s largest economy grew 5 percent, compared with an average 9.2 percent gain for the seven recessions from 1960 to 2001, they said. Employment increased 0.6 percent, short of the 4 percent increase seen in the prior recoveries.
Changes in the so-called long-run trend, or fundamental structure, of the economy, rather than the harm caused by the collapse in growth, account for almost all the shortfall in gross domestic product and more than half the slowdown in employment, according to Stock and Watson, based on comparisons with the pre-1984 averages. The authors made comparisons to earlier recessions in this case to isolate the influence of the structural changes.
The decrease in the trend, in turn, is almost entirely explained by declining population and employment growth rates, they said. One reason is a slowdown in the number of women entering the workforce, they said.
“Barring a new increase in female labor force participation or a significant increase in the growth rate of the population, these demographic factors point towards a further decline in trend growth for employment and hours in the coming decades,” Stock and Watson said. That is why future recoveries will continue to be “jobless,” they said.
end of quote
What kind of smoke and mirrors are these in light of the fact that the number of permanently discouraged workers has probably increased and the fact that many people would like to work longer or exchange their part time job for a full time job?
Puzzled,
EasternBelle
quote
Deeper recessions and more gradual recoveries will be the norm rather than the exception as the U.S. workforce grows at a slower pace, according to economists on the panel that determines when slumps begin and end.
The typical contraction “will have steeper declines and slower recoveries in output and employment,” according to a paper by Harvard University’s James Stock and Princeton University’s Mark Watson presented today at the Brookings Panel on Economic Activity inWashington. “We can expect recoveries from future recessions to be ‘jobless’ as well,” they said, similar to the two most recent rebounds.
The economists, who are members of the National Bureau of Economic Research’s business cycle dating committee, found the severity, length and aftermath of the 18-month slump that ended in June 2009 were predictable based on comparisons with past downturns.
Employment Gains Smaller
In the first eight quarters of the rebound that began in June 2009, the world’s largest economy grew 5 percent, compared with an average 9.2 percent gain for the seven recessions from 1960 to 2001, they said. Employment increased 0.6 percent, short of the 4 percent increase seen in the prior recoveries.
Changes in the so-called long-run trend, or fundamental structure, of the economy, rather than the harm caused by the collapse in growth, account for almost all the shortfall in gross domestic product and more than half the slowdown in employment, according to Stock and Watson, based on comparisons with the pre-1984 averages. The authors made comparisons to earlier recessions in this case to isolate the influence of the structural changes.
The decrease in the trend, in turn, is almost entirely explained by declining population and employment growth rates, they said. One reason is a slowdown in the number of women entering the workforce, they said.
“Barring a new increase in female labor force participation or a significant increase in the growth rate of the population, these demographic factors point towards a further decline in trend growth for employment and hours in the coming decades,” Stock and Watson said. That is why future recoveries will continue to be “jobless,” they said.
end of quote
What kind of smoke and mirrors are these in light of the fact that the number of permanently discouraged workers has probably increased and the fact that many people would like to work longer or exchange their part time job for a full time job?
Puzzled,
EasternBelle
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