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The Labor Market Four Years Into the Crisis: Assessing Structural Explanations

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  • Jesse Rothstein

Abstract

Four years after the beginning of the Great Recession, the labor market remains historically weak. Many observers have concluded that "structural" impediments to recovery bear some of the blame. This paper reviews such structural explanations. I find that there is little evidence supporting these hypotheses, and that the bulk of the evidence is more consistent with the hypothesis that continued poor performance is primarily attributable to shortfalls in the aggregate demand for labor.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17966.

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Date of creation: Mar 2012
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Publication status: published as The Labor Market Four Years Into the Crisis: Assessing Structural Explanations" Industrial and Labor Relations Review 65(3), June 2012, p.p. 467-500.
Handle: RePEc:nbr:nberwo:17966

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Cited by:
  1. Murat Tasci, 2012. "The ins and outs of unemployment in the long run: unemployment flows and the natural rate," Working Paper, Federal Reserve Bank of Cleveland 1224, Federal Reserve Bank of Cleveland.
  2. Robert J. Gordon, 2013. "The Phillips Curve is Alive and Well: Inflation and the NAIRU During the Slow Recovery," NBER Working Papers 19390, National Bureau of Economic Research, Inc.
  3. Richard B. Freeman, 2013. "Failing the Test? The Flexible U.S. Job Market in the Great Recession," NBER Working Papers 19587, National Bureau of Economic Research, Inc.
  4. Rui M. Pereira, 2013. "Okun's Law across the Business Cycle and during the Great Recession: A Markov Switching Analysis," Working Papers, Department of Economics, College of William and Mary 139, Department of Economics, College of William and Mary.
  5. Matsumoto, Makiko & Hengge, Martina & Islam, Iyanatul, 2012. "Tackling the youth employment crisis : a macroeconomic perspective," ILO Working Papers, International Labour Organization 470297, International Labour Organization.
  6. Aysun, Uluc & Bouvet, Florence & Hofler, Richard, 2014. "An alternative measure of structural unemployment," Economic Modelling, Elsevier, Elsevier, vol. 38(C), pages 592-603.
  7. Edward P. Lazear & James R. Spletzer, 2012. "The United States labor market: status quo or a new normal?," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, Federal Reserve Bank of Kansas City, pages 405-451.
  8. Aysun, Uluc, 2014. "Bankruptcy resolution capacity and economic fluctuations," Journal of Macroeconomics, Elsevier, Elsevier, vol. 40(C), pages 387-399.
  9. Menzie Chinn & Laurent Ferrara & Valérie Mignon, 2013. "Post-Recession US Employment through the Lens of a Non-Linear Okun's Law," Working Papers, CEPII research center 2013-13, CEPII research center.
  10. Peter Cappelli, 2014. "Skill Gaps, Skill Shortages and Skill Mismatches: Evidence for the US," NBER Working Papers 20382, National Bureau of Economic Research, Inc.
  11. Immervoll, Herwig, 2012. "Reforming the Benefit System to 'Make Work Pay': Options and Priorities in a Weak Labour Market," IZA Policy Papers, Institute for the Study of Labor (IZA) 50, Institute for the Study of Labor (IZA).
  12. Jeffrey P. Thompson & Timothy M. Smeeding, 2013. "Inequality and poverty in the United States: the aftermath of the Great Recession," Finance and Economics Discussion Series, Board of Governors of the Federal Reserve System (U.S.) 2013-51, Board of Governors of the Federal Reserve System (U.S.).
  13. Edward P. Lazear & James R. Spletzer, 2012. "The United States Labor Market: Status Quo or A New Normal?," NBER Working Papers 18386, National Bureau of Economic Research, Inc.
  14. Uluc Aysun & Raman Khaddaria, 2012. "Bankruptcy resolution capacity and regional economic fluctuations," Working Papers, University of Central Florida, Department of Economics 2012-01, University of Central Florida, Department of Economics.

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