Thursday, June 1, 2017
Are we at Full Employment
The official unemployment rate is very low. It has fallen from a high of 10 percent in 2009 to approximately 4.4 percent.
But above is the graph of adults of working age in the work force, i.e. adults employed, from 1990 to 2017. This represents a population of approximately 120 million people. So a fluctuation from a high of nearly 82 percent to a low of 75 percent represents a swing of 8.4 million workers.
In other words there were 8.4 million fewer working in 2009-11 than a decade before in 2000.
There remain 3 million fewer adults unemployed than we should expect compared to adult employment rate in 2000.
So we should be very skeptical of anyone who claims our economy is at full employment, says Brad DeLong. And we should not be surprised that inflation continues to fall below the Feds 2 percent target rate. Read more HERE.
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