The recession is no illusion, of course – if the chances of losing a job rise a little and the chances of finding a new one fall a little, over time the ranks of the unemployed will swell alarmingly. What is an illusion is the idea that economic booms provide substantially greater job security than recessions. They do not.
The unemployment rate is the result of millions of individual stories of finding and losing jobs. There is more than one way, then, to get the unemployment rate down: reduce the rate at which old jobs disappear, or increase the rate at which new ones are created. It isn’t hard to see which of these two options is likely to go hand in hand with a more dynamic, creative and higher-growth economy. Nor is it hard to see why so many workers naturally value protecting the job they already have, rather than some abstract promise of a new job in the future.
Creating jobs is not the same thing as making people feel secure in their jobs – not the same thing at all.
Chosen excerpts by Job Market Monitor. Read the whole story at
When we talk about unemployed resources, we usually do so with respect to labor (e.g., “Uncle Billy lost his job and he is now unemployed”). The blue line on the chart illustrates the proportion of the labor force not being used to produce goods and services—that is, the unemployment rate. Let’s discuss the three types … Continue reading »