Although parts of the economy may be on the mend, the job market is still slow to bounce back. A new report from the University of California-Berkeley shows that the recovery of America's job market is the slowest it's been since the 1940s.
Each recession of the last three decades has led to slower recovery times, and it appears America is getting worse at bouncing back, not better.
From the report to Brookings:
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From its peak of 10 percent in October of 2009, the U.S. has seen its unemployment rate fall only halfway back to its prerecession levels in the four years since. This comparatively slow rate of recovery still likely overstates the state of the job market as much of the reduction in the unemployment rate reflects a decline in labor force participation rather than job growth.
But while the pace of the U.S. job market recovery looks downright sclerotic relative to the rapid rebound experienced after the Volcker recessions of the early 1980s or prior recessions in the post-World War II era, the degree of persistence in unemployment since the Great Recession only modestly exceeds that following the 2001 recession, which in turn modestly exceeded that of the 1990 recession. From this perspective, we observe a gradual trend of increasingly "jobless recoveries" over the last three recessions that contrasts sharply with the previous U.S. experience. If this trend reflects more than a historical coincidence and were to continue, future U.S. recessions are likely to display a level of sclerosis which increasingly resembles the experience of many West European countries in the 1980s.
Experts aren't sure why this is happening, but some argue that as the workforce ages, people are less likely to leave old occupations and are less mobile. Researchers suggested future administrations drop the "timely and temporary" fiscal stimulus:
"Future administrations should, when facing recessions, have concrete plans to deal with the fact that downturns are likely to be more protracted in the foreseeable future," they said in the e-mail. That probably means fewer short-lived tax breaks and more long-running investment projects.
On The Daily Circuit, we talk with two experts about persistent joblessness and whether anything can be done to improve the current state of our economy.