NYT Opinion- Peter Coy: A Strong Labor Market Doesn’t Mean the Economy Is Recession-Proof
Excerpt from article by Peter Coy
“Economic growth has weakened considerably, but it’s still relatively easy for people to find jobs. That’s puzzling economists, who are used to seeing job offers disappear when growth slows. In other words, it’s a happy day for labor.
Things could get stranger. Judging from recent trends, there’s a chance that the economy slows down even more — or even shrinks — and yet the unemployment rate stays low…
I asked Gad Levanon, the chief economist of the Burning Glass Institute, if he could imagine a recession with low unemployment. “It never happened before,” he said. “But theoretically it is possible, and I think now it is as close as we ever got to it.
This chart shows an index of labor market tightness that Levanon created. It’s a composite of nine indicators, normalized so that the average value of each is zero. The data sources are the Bureau of Labor Statistics, the Conference Board and the National Federation of Independent Business.”
