Journal Article
What is the new normal unemployment rate?
Abstract: Recent labor markets developments, including mismatches in the skills of workers and jobs, extended unemployment benefits, and very high rates of long-term joblessness, may be impeding the return to \\"normal\\" unemployment rates of around 5%. An examination of alternative measures of labor market conditions suggests that the \\"normal\\" unemployment rate may have risen as much as 1.7 percentage points to about 6.7%, although much of this increase is likely to prove temporary. Even with such an increase, sizable labor market slack is expected to persist for years.
Keywords: economic conditions - United States; Unemployment; Labor market;
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Bibliographic Information
Provider: Federal Reserve Bank of San Francisco
Part of Series: FRBSF Economic Letter
Publication Date: 2011
Order Number: 05