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Briefing
Cyclical versus secular: decomposing the recent decline in U.S. labor force participation
Since the start of the Great Recession, one of the most striking developments in the U.S. labor market has been the pronounced decline in the labor force participation rate. The crucial issue in interpreting the decline in U.S. labor force participation is how much of the decline reflects cyclical factors and how much reflects more persistent developments such as the demographic effects of an aging population. We provide a decomposition of cyclical versus trend movements in the labor force participation rate, informed by the joint dynamics of this variable with the employment-to-population ...
Briefing
Additional slack in the economy: the poor recovery in labor force participation during this business cycle
This public policy brief examines labor force participation rates in this recession and recovery and compares them with the cyclical patterns in earlier business cycles. Measured relative to the business cycle peak in March 2001, labor force participation rates almost four years later have not recovered as much as usual, and the discrepancies are large. ; Among age-by-sex groups, the participation shortfall is especially pronounced at young and prime ages: Only for men and women age 55 and older has participation risen more than is usual four years after the business cycle peak. ; The brief ...
Briefing
A decomposition of shifts of the Beveridge curve
The apparent outward shift of the Beveridge curve?the empirical relationship between job openings and unemployment?has received much attention among economists and policymakers in the recent years with many analyses pointing to extended unemployment benefits as a reason behind the shift. However, other explanations have also been proposed for this shift, including worsening structural unemployment. ; If the increased availability of unemployment insurance (UI) benefits to the long-term unemployed is responsible for the shift in the Beveridge curve, then allowing these benefits to expire ...
Briefing
Evidence of a credit crunch?: results from the 2010 survey of first district community banks
This policy brief summarizes the findings of the Survey of Community Banks conducted by the Federal Reserve Bank of Boston in May 2010. This survey seeks to understand how the supply of, and demand for, bank business loans changed in the period following the financial crisis. The survey design focuses on assessing how much community banks were willing and able to lend to local businesses that used to be customers of large banks but lost access to credit in the aftermath of the financial crisis. The survey responses provide some evidence that lending standards for commercial loans have ...
Briefing
Understanding the \\"job-loss recovery\\"
This Public Policy Brief presents analysis of the labor market by economic research staff at the Federal Reserve Bank of Boston. It is based on materials originally presented to the Board of Directors of the Boston Fed on April 8, 2004, with selective updates incorporating data reported in early June. Contributors to this brief include David DeRemer, Jeffrey C. Fuhrer, Kristina Johnson, Jane Sneddon Little, Radoslav Raykov, Scott Schuh, Geoffrey M.B. Tootell, Robert Triest, and Anne van Grondelle. Views expressed in this brief do not necessarily reflect the views of the Federal Reserve System.
Briefing
State government budgets and the Recovery Act
State and local governments, with revenues reduced sharply by the recession, are responding by cutting services, increasing tax rates, and drawing down reserves; they are also receiving some relief in the form of stimulus funds provided by the federal government. The stimulus funds legislated in the American Recovery and Reinvestment Act only partly offset the recession-induced shortfalls and are scheduled to phase out before most analysts believe state and local governments will see fiscal recovery well underway. Thus, observers are concerned that the state-local sector will create a ...
Briefing
Cliff notes: the effects of the 2013 debt-ceiling crisis
We investigate the effects of the 2013 debt-ceiling crisis on the Treasury bill market and possible spillovers to the commercial paper market and money market funds. We also compare this experience with the prior debt-ceiling crisis in 2011. We find that the 2013 debt-ceiling crisis reduced the demand for Treasury bills that were scheduled to mature right after the debt-ceiling deadline, but not for longer-term Treasury bills. Accordingly, we see that a hump formed at the shorter end of the term structure of Treasury bill yields around the debt-ceiling deadline, with the term structure ...
Briefing
The Michigan Surveys of Consumers and consumer spending
We provide summary measures for a broad set of questions from the Michigan Surveys of Consumers. These measures summarize consumers' attitudes and expectations with respect to income, wealth, prices, and interest rates. They contain information that goes beyond the information captured by the Michigan Index of Consumer Sentiment, which is constructed from five questions in the same survey. We show that the summary measures have some explanatory power for aggregate consumption behavior over the period from 1987 to the present, even when controlling for economic fundamentals. The explanatory ...
Briefing
Inflation targeting: central bank practice overseas
This policy brief, which is based on an internal memo, summarizes the institutional and operational features observed in the 27 countries that have gained experience with inflation targeting (IT). It finds considerable convergence in many IT practices across countries over the past 10 to 15 years but much variation in policymakers? choices concerning such key issues as how they treat the borders of the target range. On the whole, most IT banks have chosen to practice inflation targeting in a more flexible and, thus, resilient fashion than many analysts once feared?seemingly without much loss ...
Briefing
Potential effects of an increase in debit card fees
Recently announced changes to debit card interchange fees could lead to an increase in the cost of debit cards to consumers. This brief analyzes the potential effects of an increase in debit card fees or in bank account fees by using the results of the 2008 and 2009 Survey of Consumer Payment Choice (SCPC). The main findings are that: 1) consumers with the least amount of education (less than a high school diploma), the lowest annual income (below $25,000), and the youngest age (under 25 years) consider cost to be the most important payment characteristic. It is probable that these consumers ...