Liberty Street Economics -Liberty Street Economics
Liberty Street Economics
Return to Liberty Street Economics Home Page

84 posts on "Unemployment"

October 16, 2020

How Do Consumers Believe the Pandemic Will Affect the Economy and Their Households?



How Do Consumers Believe the Pandemic Will Affect the Economy and Their Households?

In this post we analyze consumer beliefs about the duration of the economic impact of the pandemic and present new evidence on their expected spending, income, debt delinquency, and employment outcomes, conditional on different scenarios for the future path of the pandemic. We find that between June and August respondents to the New York Fed Survey of Consumer Expectations (SCE) have grown less optimistic about the pandemic’s economic consequences ending in the near future and also about the likelihood of feeling comfortable in crowded places within the next three months. Although labor market expectations of respondents differ considerably across fairly extreme scenarios for the evolution of the COVID pandemic, the difference in other economic outcomes across scenarios appear relatively moderate on average. There is, however, substantial heterogeneity in these economic outcomes and some vulnerable groups (for example, lower income, non-white) appear considerably more exposed to the evolution of the pandemic.

Continue reading "How Do Consumers Believe the Pandemic Will Affect the Economy and Their Households?" »

September 21, 2020

How Did State Reopenings Affect Small Businesses?



LSE_2020_reopening-small-biz_topa_460

In our previous post, we looked at the effects that the reopening of state economies across the United States has had on consumer spending. We found a significant effect of reopening, especially regarding spending in restaurants and bars as well as in the healthcare sector. In this companion post, we focus specifically on small businesses, using two different sources of high-frequency data, and we employ a methodology similar to that of our previous post to study the effects of reopening on small business activity along various dimensions. Our results indicate that, much like for consumer spending, reopenings had positive and significant effects in the short term on small business revenues, the number of active merchants, and the number of employees working in small businesses. It is important to stress that we are not expressing any views in this post on the normative question of whether, when, or how states should loosen or tighten restrictions aimed at controlling the COVID-19 pandemic.

Continue reading "How Did State Reopenings Affect Small Businesses?" »

September 18, 2020

What’s Up with the Phillips Curve?



U.S. inflation used to rise during economic booms, as businesses charged higher prices to cope with increases in wages and other costs. When the economy cooled and joblessness rose, inflation declined. This pattern changed around 1990. Since then, U.S. inflation has been remarkably stable, even though economic activity and unemployment have continued to fluctuate. For example, during the Great Recession unemployment reached 10 percent, but inflation barely dipped below 1 percent. More recently, even with unemployment as low as 3.5 percent, inflation remained stuck under 2 percent. What explains the emergence of this disconnect between inflation and unemployment? This is the question we address in “What’s Up with the Phillips Curve?,” published recently in Brookings Papers on Economic Activity.

Continue reading "What’s Up with the Phillips Curve?" »

July 13, 2020

Delaying College During the Pandemic Can Be Costly



LSE_2020_college-costly_abel_460_art

Many students are reconsidering their decision to go to college in the fall due to the coronavirus pandemic. Indeed, college enrollment is expected to be down sharply as a growing number of would-be college students consider taking a gap year. In part, this pullback reflects concerns about health and safety if colleges resume in-person classes, or missing out on the “college experience” if classes are held online. In addition, poor labor market prospects due to staggeringly high unemployment may be leading some to conclude that college is no longer worth it in this economic environment. In this post, we provide an economic perspective on going to college during the pandemic. Perhaps surprisingly, we find that the return to college actually increases, largely because the opportunity cost of attending school has declined. Furthermore, we show there are sizeable hidden costs to delaying college that erode the value of a college degree, even in the current economic environment. In fact, we estimate that taking a gap year reduces the return to college by a quarter and can cost tens of thousands of dollars in lost lifetime earnings.

Continue reading "Delaying College During the Pandemic Can Be Costly" »

June 16, 2020

Finally, Some Signs of Improvement in the Regional Economy



LSE_2020_jr-econ-improvement_deitz_460

The Federal Reserve Bank of New York’s June business surveys show some signs of improvement in the regional economy. Following two months of unprecedented decline due to the coronavirus pandemic, indicators of business activity point to a slower pace of contraction in the service sector and signs of a rebound in the manufacturing sector. Even more encouraging, as the regional economy has begun to reopen, many businesses have started to recall workers who were laid off or put on furlough since the start of the pandemic. Some have even hired new workers. Moreover, businesses expect to recall even more workers over the next month. Looking ahead, firms have become increasingly optimistic that conditions will improve in the coming months.

Continue reading "Finally, Some Signs of Improvement in the Regional Economy" »

May 27, 2020

Job Training Mismatch and the COVID-19 Recovery: A Cautionary Note from the Great Recession



LSE_Job Training Mismatch and the COVID-19 Recovery: A Cautionary Note from the Great Recession


Displaced workers have been shown to endure persistent losses years beyond their initial job separation events. These losses are especially amplified during recessions. (1) One explanation for greater persistence in downturns relative to booms, is that firms and industries on the margin of structural change permanently shift the types of tasks and occupations demanded after a large negative shock (Aghion et al. (2005)), but these new occupations do not match the stock of human capital held by those currently displaced. In response to COVID-19, firms with products and services that complement social-distancing (like Amazon distribution centers) may continue hiring during and beyond the recovery, while workers displaced from higher risk industries with more stagnant demand (for example, airport personnel, local retail clerks) are left to adjust to less familiar job opportunities. As some industries reopen gradually while others remain stunted, what role might workforce development programs have in bridging the skill gap such that displaced workers are best prepared for this new reality of work?

Continue reading "Job Training Mismatch and the COVID-19 Recovery: A Cautionary Note from the Great Recession" »

May 26, 2020

Consumers Increasingly Expect Additional Government Support amid COVID-19 Pandemic



Consumers Increasingly Expect Additional Government Support amid COVID-19 Pandemic

The New York Fed’s Center for Microeconomic Data released results today from its April 2020 SCE Public Policy Survey, which provides information on consumers' expectations regarding future changes to a wide range of fiscal and social insurance policies and the potential impact of these changes on their households. These data have been collected every four months since October 2015 as part of our Survey of Consumer Expectations (SCE). Given the ongoing COVID-19 pandemic, households face significant uncertainty about their personal situations and the general economic environment when forming plans and making decisions. Tracking individuals’ subjective beliefs about future government policy changes is important for understanding and predicting their behavior in terms of spending and labor supply, which will be crucial in forecasting the economic recovery in the months ahead.

Continue reading "Consumers Increasingly Expect Additional Government Support amid COVID-19 Pandemic" »

Posted by Blog Author at 11:00 AM in Expectations, Fiscal Policy, Pandemic, Unemployment | Permalink | Comments (0)

May 07, 2020

Translating Weekly Jobless Claims into Monthly Net Job Losses



LSE_2020_weekly-job-loss_bram_460

News headlines highlighting the loss of at least 30 million jobs (so far) underscore the massive shock that has hit the U.S. economy and the dislocation, hardship, and stress it has caused for so many American workers. But how accurately does this number actually capture the number of net job losses? In this post, we look at some of the statistical anomalies and quirks in the weekly claims series and offer a guide to interpreting these numbers. What we find is that the relationship between jobless claims and payroll employment for the month can vary substantially, depending on the nature, timing, and persistence of the disaster.

Continue reading "Translating Weekly Jobless Claims into Monthly Net Job Losses" »

March 04, 2020

How Does Credit Access Affect Job-Search Outcomes and Sorting?



How Does Credit Access Affect Job-Search Outcomes and Sorting?

How does access to consumer credit affect the job finding behavior of displaced workers? Are these workers looking for jobs at larger and more productive firms? What is the impact of consumer credit on the amount of time it takes to find a job? In recent work with Ethan Cohen-Cole we explore these questions by building a new data set of individual credit reports (from TransUnion) merged with administrative earnings data. We describe our approach and our results in this post.

Continue reading "How Does Credit Access Affect Job-Search Outcomes and Sorting?" »

Posted by Blog Author at 7:45 AM in Credit, Labor Market, Unemployment | Permalink | Comments (0)

Is the Tide Lifting All Boats? A Closer Look at the Earnings Growth Experiences of U.S. Workers



Is the Tide Lifting All Boats? A Closer Look at the Earnings Growth Experiences of U.S. Workers

The growth rate of hourly earnings is a widely used indicator to assess the economic progress of U.S. workers, as well as the health of the labor market. It is also a measure of wage pressures that could potentially spill over into inflationary pressures in a tightening labor market. Hourly earnings growth, on average, has gradually risen over the course of the current expansion, under way since the end of the Great Recession. But how have different groups of workers fared in this regard? Have hourly earnings risen uniformly at all points of the wage distribution, or have some segments of the workforce been left behind? In this post, we take a close look at earnings growth over the past two decades at different points of the wage distribution and for various demographic groups. Our goal is to examine whether there are any significant patterns in the evolution of the distribution of earnings, as opposed to just looking at the behavior of aggregate earnings growth. We focus primarily on hourly earnings growth, although our findings apply to total earnings as well.

Continue reading "Is the Tide Lifting All Boats? A Closer Look at the Earnings Growth Experiences of U.S. Workers" »

Posted by Blog Author at 7:15 AM in Inequality, Labor Market, Unemployment, Wages | Permalink | Comments (0)
About the Blog
Liberty Street Economics features insight and analysis from New York Fed economists working at the intersection of research and policy. Launched in 2011, the blog takes its name from the Bank’s headquarters at 33 Liberty Street in Manhattan’s Financial District.

The editors are Michael Fleming, Andrew Haughwout, Thomas Klitgaard, and Asani Sarkar, all economists in the Bank’s Research Group.

Liberty Street Economics does not publish new posts during the blackout periods surrounding Federal Open Market Committee meetings.

The views expressed are those of the authors, and do not necessarily reflect the position of the New York Fed or the Federal Reserve System.


Economic Research Tracker

Liberty Street Economics is now available on the iPhone® and iPad® and can be customized by economic research topic or economist.


Most Viewed

Last 12 Months
Useful Links
Comment Guidelines
We encourage your comments and queries on our posts and will publish them (below the post) subject to the following guidelines:
Please be brief: Comments are limited to 1500 characters.
Please be quick: Comments submitted after COB on Friday will not be published until Monday morning.
Please be aware: Comments submitted shortly before or during the FOMC blackout may not be published until after the blackout.
Please be on-topic and patient: Comments are moderated and will not appear until they have been reviewed to ensure that they are substantive and clearly related to the topic of the post. We reserve the right not to post any comment, and will not post comments that are abusive, harassing, obscene, or commercial in nature. No notice will be given regarding whether a submission will or will not be posted.‎
Disclosure Policy
The LSE editors ask authors submitting a post to the blog to confirm that they have no conflicts of interest as defined by the American Economic Association in its Disclosure Policy. If an author has sources of financial support or other interests that could be perceived as influencing the research presented in the post, we disclose that fact in a statement prepared by the author and appended to the author information at the end of the post. If the author has no such interests to disclose, no statement is provided. Note, however, that we do indicate in all cases if a data vendor or other party has a right to review a post.
Archives