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Is structural unemployment on the rise?

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  • Katherine Kuang
  • Robert G. Valletta

Abstract

An increase in U.S. aggregate labor demand reflected in rising job vacancies has not been accompanied by a similar decline in the unemployment rate. Some analysts maintain that unemployed workers lack the skills to fill available jobs, a mismatch that contributes to an elevated level of structural unemployment. However, analysis of data on employment growth and jobless rates across industries, occupations, and states suggests only a limited increase in structural unemployment, indicating that cyclical factors account for most of the rise in the unemployment rate.

Suggested Citation

  • Katherine Kuang & Robert G. Valletta, 2010. "Is structural unemployment on the rise?," FRBSF Economic Letter, Federal Reserve Bank of San Francisco, issue nov8.
    • Handle: RePEc:fip:fedfel:y:2010:i:nov8:n:2010-34
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    References listed on IDEAS

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    1. Athanasios Orphanides & John C. Williams, 2002. "Robust Monetary Policy Rules with Unknown Natural Rates," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 33(2), pages 63-146.
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    Cited by:

    1. Hall, R.E., 2016. "Macroeconomics of Persistent Slumps," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 2131-2181, Elsevier.
    2. Thomas Van Gent & Farida C. Khan & Norman Cloutier, 2019. "Industrial Effects on Male and Female Unemployment Over the Great Recession: An Interurban Analysis," The American Economist, Sage Publications, vol. 64(1), pages 19-30, March.
    3. Aysun, Uluc & Bouvet, Florence & Hofler, Richard, 2014. "An alternative measure of structural unemployment," Economic Modelling, Elsevier, vol. 38(C), pages 592-603.
    4. Yelena Takhtamanova & Eva Sierminska, 2012. "Distributional Impact of the Great Recession on Industry Unemployment for 1976-2011," Discussion Papers of DIW Berlin 1233, DIW Berlin, German Institute for Economic Research.
    5. Hugo Erken & Eric van Loon & Wouter Verbeek, 2015. "Mismatch on the Dutch labour market in the Great Recession," CPB Discussion Paper 303.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    6. Takhtamanova, Yelena F. & Sierminska, Eva, 2016. "Impact of the Great Recession on Industry Unemployment: A 1976-2011 Comparison," IZA Discussion Papers 10340, Institute of Labor Economics (IZA).
    7. Julie L. Hotchkiss & M. Melinda Pitts & Fernando Rios-Avila, 2012. "A closer look at nonparticipants during and after the Great Recession," FRB Atlanta Working Paper 2012-10, Federal Reserve Bank of Atlanta.
    8. Hugo Erken & Eric van Loon & Wouter Verbeek, 2015. "Mismatch on the Dutch labour market in the Great Recession," CPB Discussion Paper 303, CPB Netherlands Bureau for Economic Policy Analysis.
    9. Menzie D. Chinn, 2012. "Imbalances, Overheating and the Prospects for Global Recovery," Chapters, in: Maurice Obstfeld & Dongchul Cho & Andrew Mason (ed.), Global Economic Crisis, chapter 6, Edward Elgar Publishing.
    10. David Gruen & Bonnie Li & Tim Wong, 2012. "Unemployment disparity across regions," Economic Roundup, The Treasury, Australian Government, issue 2, pages 63-78, August.

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    Keywords

    Labor market; Unemployment;

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