Today, the Federal Reserve Bank of New York (FRBNY) is hosting the spring meeting of its Economic Advisory Panel (EAP). As has become the custom at this meeting, the FRBNY staff is presenting its forecast for U.S. growth, inflation, and the unemployment rate.
Japan offers a preview of future U.S. demographic trends, having already seen a large increase in the population over 65.
Economic forecasters frequently use a simple rule of thumb called Okun’s law to link their real GDP growth forecasts to their unemployment rate forecasts.
The unemployment rate in the United States fell from 9.1 percent in the summer of 2011 to 8.3 percent in February.
What will the unemployment rate be in 2013? Even if you were certain how much the U.S. economy (gross domestic product, or GDP) would grow over the next year or two, it would still be difficult to forecast the unemployment rate over that period.