Key phrase to remember
Lifted from an article in the NYT. In the heat of media debates certain fundamental narratives get lost regarding the tools we use to evaluate policies. Pre-occupation with unemplayment is one of them. While familiar to readers of Angry Bear, it bears reminding ourselves that while ‘economics’ attempts to figure out how the economy works, the heart of our policy and polity can take various forms. This one seemed apt.
…if declines in the unemployment rate are not matched by a rising employment rate.
“We do not want to get to 6.5 percent just by having people pull out of the labor force,” Mr. Rosengren of the Boston Fed said. “We want to get to 6.5 because employment is expanding and we’re adding jobs faster than labor force growth.”
What would an ’employment rate ‘ look like?
What do you mean, “What would an employment rate look like”? The Employment-to-Population ratio published by BLS isn’t an employment rate in your book?
Ah well….try mentioning the ratio to most anyone in general…the response ‘huh?’ would most likely be the response….how would you explain an employment rate in the simplistic manner the unemployment rate is used? Or not possible for either to be understood so simply? Where does that leave us in general?