Journal Article

What constitutes substantial employment gains in today’s labor market?

Abstract: The Federal Open Market Committee (FOMC) has tied its asset purchases to a ?substantial improvement? in labor market conditions. While we don?t speculate on what the FOMC means by substantial improvement, we do explore the level of monthly job gains that would gradually deliver the underlying trend unemployment rate within a reasonable timeframe, under several plausible scenarios. We find that the path of monthly job gains, which is highly dependent on a few key parameters, is likely to be smaller than the path associated with previous recoveries.

Keywords: Labor market; Federal Open Market Committee;

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Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Economic Commentary

Publication Date: 2013

Issue: Jun

Order Number: 07