This is one of the big questions economists and top economic
policymakers tried to answer as they gathered here over the past few
days for a symposium hosted by the Federal Reserve Bank of Kansas City.
One popular theory for why joblessness has stayed so high — currently at 8.3 percent, with a large portion of people unemployed for more than six months — is a rising amount of what economists call structural unemployment.
That’s the belief that a large number of the people looking for jobs are struggling not because there are not enough jobs available, but rather because they’re the wrong age or don’t have the right education or skills.
Some argue that if these fundamental factors are behind the nation’s weak labor market, there’s little that government can do, at least in the short term, to boost employment. The thinking is that even if a company has enough business, it won’t hire a new worker who’s the wrong age or doesn’t have the appropriate skills.
But a new paper by Edward Lazear, a Stanford professor and former top economic adviser to George W. Bush, and James Spletzer, a top economist at the Census Bureau, concludes that structural unemployment isn’t a problem.
Read more: http://www.washingtonpost.com/business/economy/if-unemployment-isnt-structural-what-causes-it/2012/09/01/35fed7e0-f45e-11e1-892d-bc92fee603a7_story.html?hpid=z3
One popular theory for why joblessness has stayed so high — currently at 8.3 percent, with a large portion of people unemployed for more than six months — is a rising amount of what economists call structural unemployment.
That’s the belief that a large number of the people looking for jobs are struggling not because there are not enough jobs available, but rather because they’re the wrong age or don’t have the right education or skills.
Some argue that if these fundamental factors are behind the nation’s weak labor market, there’s little that government can do, at least in the short term, to boost employment. The thinking is that even if a company has enough business, it won’t hire a new worker who’s the wrong age or doesn’t have the appropriate skills.
But a new paper by Edward Lazear, a Stanford professor and former top economic adviser to George W. Bush, and James Spletzer, a top economist at the Census Bureau, concludes that structural unemployment isn’t a problem.
Read more: http://www.washingtonpost.com/business/economy/if-unemployment-isnt-structural-what-causes-it/2012/09/01/35fed7e0-f45e-11e1-892d-bc92fee603a7_story.html?hpid=z3
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