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Employment growth and labor force participation: how many jobs are enough?

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Abstract

Public concerns about the ?jobless? recovery following the 2001 recession have centered on whether enough jobs will be created for those who want to work. A more pressing question, however, may be how many jobs are needed to sustain desired growth in overall economic output. ; This article provides an analysis of just how many jobs are needed to keep unemployment in check and considers whether the current rate of job creation is enough to fuel optimal gross domestic product growth. The author examines the decline in the labor force participation rate that has occurred since the late 1990s. Part of the decline in the rate is likely a response to fewer job opportunities as a result of the recession. She also notes, however, that the decline suggests other, noncyclical factors may be at play and are likely to be compounded by baby boomers entering retirement age. The author discusses the pros and cons of some options for increasing the flow of workers into the labor force, including raising the retirement age, increasing immigration, and offshore outsourcing. ; While the current rate of job creation should be able to sustain the expected labor force growth for the near term, she concludes, it is not clear that this rate can sustain a desirable rate of economic growth in the long run. Any of the options policymakers have for affecting this trend of slower labor force growth will take time to implement and adjust to, suggesting that serious discussions of these options? respective merits should begin now.

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  • Julie L. Hotchkiss, 2005. "Employment growth and labor force participation: how many jobs are enough?," Economic Review, Federal Reserve Bank of Atlanta, vol. 90(Q 1), pages 1-13.
  • Handle: RePEc:fip:fedaer:y:2005:i:q1:p:1-13:n:v.90no.1
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    Cited by:

    1. Ivan O. KITOV, 2008. "The Driving Force of Labor Force Participation in Developed Countries," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 3(3(5)_Fall), pages 203-222.
    2. Heather Boushey, 2008. "“Opting out?” The effect of children on women's employment in the United States," Feminist Economics, Taylor & Francis Journals, vol. 14(1), pages 1-36.
    3. Julie L. Hotchkiss & Myriam Quispe‐Agnoli & Fernando Rios‐Avila, 2015. "The wage impact of undocumented workers: Evidence from administrative data," Southern Economic Journal, John Wiley & Sons, vol. 81(4), pages 874-906, April.
    4. Julie L. Hotchkiss & Myriam Quispe-Agnoli, 2008. "The labor market experience and impact of undocumented workers," FRB Atlanta Working Paper 2008-07, Federal Reserve Bank of Atlanta.
    5. Christopher L. ERICKSON & Daniel J.B. MITCHELL, 2007. "Monopsony as a metaphor for the emerging post-union labour market," International Labour Review, International Labour Organization, vol. 146(3-4), pages 163-187, September.
    6. Riccardo DiCecio & Kristie M. Engemann & Michael T. Owyang & Christopher H. Wheeler, 2008. "Changing trends in the labor force: a survey," Review, Federal Reserve Bank of St. Louis, vol. 90(Jan), pages 47-62.
    7. Julie L. Hotchkiss & Myriam Quispe-Agnoli & Fernando Rios-Avila, 2012. "The wage impact of undocumented workers," FRB Atlanta Working Paper 2012-04, Federal Reserve Bank of Atlanta.
    8. Ashley Hodgson & Stacey L. Schreft & Aarti Singh, 2005. "Jobless recoveries and the wait-and-see hypothesis," Economic Review, Federal Reserve Bank of Kansas City, vol. 90(Q IV), pages 81-99.

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