A jobless recovery or jobless growth is an economic phenomenon in which a macroeconomy experiences growth while maintaining or decreasing its level of employment. The term was coined by the economist Nick Perna in the early 1990s.[1][2]
Causes
Economists are still divided about the causes and cures of a jobless recovery: some argue that increased productivity through automation has allowed economic growth without reducing unemployment.[3] Other economists state that blaming automation is an example of the luddite fallacy[4] and that jobless recoveries stem from structural changes in the labor market, leading to unemployment as workers change jobs or industries.[5]
Industrial consolidation
Some have argued that the recent lack of job creation in the United States is due to increased industrial consolidation and growth of monopoly or oligopoly power.[6] The argument is twofold: firstly, small businesses create most American jobs, and secondly, small businesses have more difficulty starting and growing in the face of entrenched existing businesses (compare infant industry argument, applied at the level of industries, rather than individual firms).
Population growth vs. employment growth
In addition to employment growth, population growth must also be considered concerning the perception of jobless recoveries. Immigrants and new entrants to the workforce will often accept lower wages, causing persistent unemployment among those who were previously employed.[7][8]
Surprisingly, the U.S. Bureau of Labor Statistics (BLS) does not offer data-sets isolated to the working-age population (ages 16 to 65).[9] Including retirement age individuals in most BLS data-sets may tend to obfuscate the analysis of employment creation in relation to population growth.[10] Additionally, incorrect assumptions about the term, Labor force, might also occur when reading BLS publications, millions of employable persons are not included within the official definition. The Labor force, as defined by the BLS,[11] is a strict definition of those officially unemployed (U-3),[12] and those who are officially employed (1 hour or more).[13]
Once again, the baby-boom generation has become a generator of change, this time in its retirement. Moreover, the jobless recovery of the 2001 recession, coupled with the severe economic impact of the 2007–2009 recession, caused disruptions in the labor market. In the first 12 years of the 21st century, the growth of the population has slowed and labor force participation rates generally have declined. As a result, labor force growth also has slowed. The Bureau of Labor Statistics (BLS) projects that the next 10 years will bring about an aging labor force that is growing slowly, a declining overall labor force participation rate, and more diversity in the racial and ethnic composition of the labor force.
The following table and included chart depicts year-to-year employment growth in comparison to population growth for those persons under 65 years of age. As such, baby boomer retirements are removed from the data as a factor for consideration. The table includes the Bureau of Labor Statistics, Current Population Survey, for the Civilian noninstitutional population and corresponding Employment Levels, dating from 1948 and includes October 2013, the age groups are 16 years & over, and 65 years & over.[9] The working-age population is then determined by subtracting those age 65 and over from the Civilian noninstitutional population and Employment Levels respectively. Isolated into the traditional working-age subset, growth in both employment levels and population levels are totaled by decade, an employment percentage rate is also displayed for comparison by decade.
When examined, by decade, the first decade of the 2000s, the United States suffered a 5% jobless rate when compared to the added working age population.
U.S. Growth: Employment level growth Vs. population level growth by decade
Civilian noninstitutional population
Working-age population
Employment levels
Working-age employment
Year
Age: 16 years & over
Age: 65 yrs. & over
Age: 16 to 65 yrs.
Growth – decade
Age: 16 years & over
Age: 65 yrs. & over
Age: 16 to 65
Growth – decade
Percent emp.
1948
103,468,000
10,881,000
92,587,000
58,554,000
2,906,000
55,648,000
1949
104,524,000
11,191,000
93,333,000
—
57,712,000
2,926,000
54,786,000
—
—
1950
104,872,000
11,534,000
93,338,000
59,352,000
2,845,000
56,507,000
1951
104,810,000
11,918,000
92,892,000
60,252,000
2,858,000
57,394,000
1952
105,812,000
12,334,000
93,478,000
60,748,000
3,000,000
57,748,000
1953
107,623,000
13,257,000
94,366,000
59,796,000
2,882,000
56,914,000
1954
108,892,000
13,520,000
95,372,000
59,990,000
2,963,000
57,027,000
1955
110,296,000
13,925,000
96,371,000
63,268,000
3,213,000
60,055,000
1956
111,526,000
14,215,000
97,311,000
63,619,000
3,213,000
60,406,000
1957
113,013,000
14,516,000
98,497,000
63,598,000
3,089,000
60,509,000
1958
114,429,000
14,821,000
99,608,000
63,266,000
2,855,000
60,411,000
1959
116,040,000
15,148,000
100,892,000
7,559,000
64,927,000
3,024,000
61,903,000
7,117,000
94.15%
1960
118,001,000
15,508,000
102,493,000
65,287,000
3,176,000
62,111,000
1961
119,214,000
15,861,000
103,353,000
65,531,000
2,885,000
62,646,000
1962
121,236,000
16,880,000
104,356,000
66,585,000
2,821,000
63,764,000
1963
123,360,000
17,014,000
106,346,000
67,791,000
2,765,000
65,026,000
1964
125,468,000
17,296,000
108,172,000
69,543,000
2,913,000
66,630,000
1965
127,294,000
17,580,000
109,714,000
71,819,000
2,926,000
68,893,000
1966
128,730,000
17,860,000
110,870,000
73,600,000
2,892,000
70,708,000
1967
130,936,000
18,194,000
112,742,000
75,337,000
3,030,000
72,307,000
1968
133,120,000
18,500,000
114,620,000
76,699,000
3,086,000
73,613,000
1969
135,489,000
18,825,000
116,664,000
15,772,000
78,789,000
3,069,000
75,720,000
13,817,000
87.60%
1970
138,529,000
19,202,000
119,327,000
78,651,000
3,032,000
75,619,000
1971
141,666,000
19,605,000
122,061,000
80,527,000
3,005,000
77,522,000
1972
145,446,000
20,229,000
125,217,000
83,424,000
2,909,000
80,515,000
1973
148,479,000
20,536,000
127,943,000
86,390,000
2,787,000
83,603,000
1974
151,494,000
21,214,000
130,280,000
86,169,000
2,794,000
83,375,000
1975
154,589,000
21,803,000
132,786,000
86,689,000
2,680,000
84,009,000
1976
157,438,000
22,309,000
135,129,000
89,850,000
2,791,000
87,059,000
1977
160,377,000
22,874,000
137,503,000
94,183,000
2,903,000
91,280,000
1978
163,272,000
23,450,000
139,822,000
97,669,000
3,006,000
94,663,000
1979
166,300,000
24,067,000
142,233,000
25,569,000
100,013,000
3,002,000
97,011,000
21,291,000
83.27%
1980
168,883,000
24,597,000
144,286,000
99,579,000
2,907,000
96,672,000
1981
171,166,000
25,109,000
146,057,000
99,562,000
2,928,000
96,634,000
1982
173,199,000
25,619,000
147,580,000
98,849,000
2,878,000
95,971,000
1983
175,121,000
26,160,000
148,961,000
102,803,000
2,878,000
99,925,000
1984
177,306,000
26,712,000
150,594,000
106,049,000
2,797,000
103,252,000
1985
179,112,000
27,266,000
151,846,000
108,063,000
2,841,000
105,222,000
1986
181,547,000
27,791,000
153,756,000
110,588,000
2,909,000
107,679,000
1987
183,620,000
28,362,000
155,258,000
113,679,000
3,126,000
110,553,000
1988
185,402,000
28,875,000
156,527,000
115,978,000
3,264,000
112,714,000
1989
187,165,000
29,462,000
157,703,000
15,470,000
117,698,000
3,352,000
114,346,000
17,335,000
112.06%
1990
190,017,000
29,453,000
160,564,000
118,110,000
3,256,000
114,854,000
1991
191,798,000
29,893,000
161,905,000
117,395,000
3,193,000
114,202,000
1992
193,784,000
30,396,000
163,388,000
118,990,000
3,341,000
115,649,000
1993
195,794,000
30,784,000
165,010,000
121,578,000
3,394,000
118,184,000
1994
197,765,000
31,181,000
166,584,000
124,729,000
3,641,000
121,088,000
1995
199,508,000
31,629,000
167,879,000
125,136,000
3,676,000
121,460,000
1996
201,636,000
31,902,000
169,734,000
127,903,000
3,807,000
124,096,000
1997
204,098,000
32,071,000
172,027,000
130,785,000
3,933,000
126,852,000
1998
206,270,000
32,275,000
173,995,000
132,732,000
3,855,000
128,877,000
1999
208,832,000
32,538,000
176,294,000
18,591,000
134,696,000
3,984,000
130,712,000
16,366,000
88.03%
2000
213,736,000
33,590,000
180,146,000
137,846,000
4,244,000
133,602,000
2001
216,315,000
33,823,000
182,492,000
136,269,000
4,300,000
131,969,000
2002
218,741,000
34,004,000
184,737,000
136,599,000
4,248,000
132,351,000
2003
222,509,000
34,432,000
188,077,000
138,556,000
4,711,000
133,845,000
2004
224,640,000
34,796,000
189,844,000
140,278,000
4,902,000
135,376,000
2005
227,425,000
35,208,000
192,217,000
142,918,000
5,263,000
137,655,000
2006
230,108,000
35,841,000
194,267,000
146,081,000
5,617,000
140,464,000
2007
233,156,000
36,603,000
196,553,000
146,334,000
5,787,000
140,547,000
2008
235,035,000
37,522,000
197,513,000
143,350,000
6,084,000
137,266,000
2009
236,924,000
38,362,000
198,562,000
22,268,000
137,953,000
6,193,000
131,760,000
1,048,000
4.71%
2010
238,889,000
39,045,000
199,844,000
139,159,000
6,376,000
132,783,000
2011
240,584,000
40,364,000
200,220,000
140,681,000
6,893,000
133,788,000
2012
244,350,000
42,695,000
201,655,000
143,060,000
7,412,000
135,648,000
2013
246,745,000
44,155,000
202,590,000
144,423,000
7,748,000
136,675,000
2014
249,027,000
45,685,000
203,342,000
147,190,000
8,140,000
139,050,000
2015
251,936,000
47,269,000
204,667,000
149,703,000
8,552,000
141,151,000
2016
254,742,000
48,837,000
205,905,000
7,343,000
151,798,000
8,820,000
142,978,000
11,218,000
152.77%
Pre and Post 2000 Comparisons (working age)
Pop. Growth
Employment Growth
1900s
1950 to 1999
82,961,000
75,926,000
91.52%
2000s
2000 to 2016
29,611,000
12,266,000
41.42%
Bold denotes datum used to produce "Working-Age: Growth Decade" calculation Decade example = End of year 1949 to end of year 1959 Source: Bureau of Labor Statistics, Current Population Survey[9]
Series Id: LNU00000000 Not Seasonally Adjusted Series title: (Unadj.) population Level Labor force status: Civilian noninstitutional population age: 16 years and over
Series Id: LNU02000000 Not Seasonally Adjusted Series title: (Unadj.) employment Level Labor force status: Employed Age: 16 years and over
Series Id:LNU00000097 Not Seasonally Adjusted Series title: (Unadj.) population Level - 65 yrs. & over Labor force status: Civilian noninstitutional population age: 65 years and over
Series Id: LNU02000097 Not Seasonally Adjusted Series title: (Unadj.) employment Level - 65 yrs. & over Labor force status: Employed Age: 65 years and over
^Peri, Giovanni. "Immigration, Labor Markets, and Productivity"(PDF). Cato Journal, Vol. 32, No. 1 (Winter 2012). Archived from the original(PDF) on 9 October 2012. Retrieved 2 March 2014. In this case firms pay immigrants less than their marginal productivity, increasing the firms' profits. Such cost-savings on immigrants act as an increase in productivity for firms.
^"Glossary". Labor Force. Bureau of Labor Statistics. Retrieved 2 March 2014. Labor force (Current Population Survey) The labor force includes all persons classified as employed or unemployed in accordance with the definitions contained in this glossary.
