There has been a noticeable shift in the curve, indicating a less efficient labor market. In the 2000s labor market, the rate of vacancies we have today would correspond with an unemployment rate of around 5.5 to 6%.
April 14, 2013
Another Labor Market Graph
Here's another useful graph for understanding the current state of the labor market. It's known as the Beveridge Curve, which graphs the relationship between job vacancies and the unemployment rate. With no changes in the efficiency of a labor market, a given level of openings should correspond with a given unemployment rate. For example, 2005 and 2006 in the graph below have roughly the same number of vacancies and similar unemployment rates.
April 12, 2013
More (and better) Unemployment Indicators
In addition to the monthly job growth numbers, I felt it would be nice to give some greater detail of unemployment through this recover. First, a couple graphs showing the increase in long term unemployment.
And last, a graph of the best unemployment indicator, the Employment to Population Ratio. It is presented as the number of people 16 and older employed over the number of people 16 and over multiplied by 100. The benefit is that, unlike the unemployment rate, people leaving the labor force doesn't make the statistic look better. Most OECD countries have an upper age limit, which is smarter. Retiring baby boomers would bring down the ratio all else remaining constant (notice that the ratio was decreasing slowly before the recession hit).
So the reality is slightly better than the graph would initially indicate.
And last, a graph of the best unemployment indicator, the Employment to Population Ratio. It is presented as the number of people 16 and older employed over the number of people 16 and over multiplied by 100. The benefit is that, unlike the unemployment rate, people leaving the labor force doesn't make the statistic look better. Most OECD countries have an upper age limit, which is smarter. Retiring baby boomers would bring down the ratio all else remaining constant (notice that the ratio was decreasing slowly before the recession hit).
So the reality is slightly better than the graph would initially indicate.
April 5, 2013
March Jobs Report
March employment growth was the worst since June of 2012. 88,000 jobs were added, and the unemployment rate decreased to 7.6% due to people leaving the labor force.
Naturally, the fact that the sequester hit in March comes to mind for a potential cause. While the amount of spending cut so far is bound to be tiny (due to lags in appropriations and spending only $41 billion of the $85 billion in cuts for 2013 will take effect in 2013), there is no longer any optimistic uncertainty that they will happen.
On the other hand, bad reports have come and gone and sometimes been revised away, so it can't be said with certainty that the report really was this bad, or that it was caused by any one thing specifically. Numbers for January and February were revised up somewhat.
Naturally, the fact that the sequester hit in March comes to mind for a potential cause. While the amount of spending cut so far is bound to be tiny (due to lags in appropriations and spending only $41 billion of the $85 billion in cuts for 2013 will take effect in 2013), there is no longer any optimistic uncertainty that they will happen.
On the other hand, bad reports have come and gone and sometimes been revised away, so it can't be said with certainty that the report really was this bad, or that it was caused by any one thing specifically. Numbers for January and February were revised up somewhat.
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