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Briefing
Human Capital Investment: Would Higher-Order Skills Help Disconnected Youth?
Human capital investments remain cost-effective well into young adulthood.A multidimensional approach to human capital development emphasizes developing self-reflection abilities and strategic thinking skills alongside traditional academic knowledge.Higher-order skills — like teamwork, critical thinking and self-control — offer high returns for disconnected youth and are well-compensated in the labor market.
Briefing
Public and Private Labor Market Data: Insights From the Government Shutdown
Private and public data are complements, not substitutes: Private sources offer speed and granularity, while government surveys provide representative benchmarks.Different data sources can measure similar but subtlety different things. For instance, JOLTS, ADP, RPLS and Gusto all measure "employment" but define it in different ways.These differences can lead to very different measurements, illustrated by two private data sources diverging by 100,000 jobs during the shutdown.
Briefing
Monthly Job Reports: How Do Private Sources Fare?
The Bureau of Labor Statistics produces monthly estimates on job gains/losses through the Current Employment Statistics' establishment survey.In the past few years, more alternative job reports have become available through private sources, such as ADP, Revelio, LinkUp and Intuit.While job estimates from these private sources can replicate the trend pattern of their official BLS counterpart, they are not always accurate and reliable at higher frequencies, especially during volatile periods.
Briefing
Modelling Unemployment Insurance in the Real World
We create an economic model of unemployment insurance designed to accurately capture the life cycle of workers.A socially optimal unemployment insurance program would replace 63 percent of a worker’s income for six months after termination.This result bridges the previous disagreement between partial and general equilibrium models of unemployment insurance.
Briefing
The Natural Beveridge Curve
The Beveridge curve is a central concept for analyzing the state of the economy and the labor market.We introduce the idea of a natural Beveridge curve, which abstracts from transitory movements and focuses on structural relationships.Analyzing the gap between the actual and natural Beveridge curves gives policymakers a better sense of how much stabilization policy in the labor market can accomplish.
Briefing
The Postpandemic City: Urban Employment Centers and Commuting in the Fifth District
Employer-reported data through 2023 reveal a divergence in postpandemic commuting patterns across four large metropolitan areas within the Fifth District.Washington, D.C., lost 1 percentage point of its metropolitan area's employment share to suburban destinations between the prepandemic period (2017-19) and the postpandemic period (2023), while Baltimore, Richmond and Charlotte all maintained or increased their cores' share.Washington's losses fall primarily on high-earning workers and are spatially concentrated in more distant suburbs.
Briefing
Career Progressions and Wage Growth: Decreasing the Gap Between Richer and Poorer Workers
In our previous article, we explored the contribution of different career dynamics to the earnings gap between poorer and richer workers. We emphasized how poorer workers do not lack opportunities to change jobs, as they have high job mobility rates. Thus, they potentially could work at increasingly better-paying firms but seldom do so in practice. Looking at previous economic literature — including a leading framework for the labor market: the job ladder model — we argued that postulating a common job ladder for both poorer and richer workers is not supported by the data. In this ...
Briefing
The Persistent Decline of LFP Rates for Older Individuals Around the Pandemic
Labor force participation (LFP) experienced a bit of a roller coaster ride with the onset of the pandemic. But not all age groups experienced the ride in the same way. For example, we see two very different paths for the LFP rates of prime-age (25-54 years old) individuals on one hand and individuals over 55 years old on the other. In this article, I focus on the latter group, for which (as of September 2024) LFP rates have not recovered to prepandemic levels.
Briefing
To Whom It May Concern: Demographic Differences in Letters of Recommendation
Letters of recommendation from faculty advisors play a critical role in the job market for Ph.D. economists. At their best, they can convey important qualitative information about a candidate, including the candidate's potential to generate impactful research. But at their worst, these letters offer a subjective view of the candidate that can be susceptible to conscious or unconscious bias. There may also be similarity or affinity bias, a particularly difficult issue for the economics profession, where most faculty members are White men. In this post, we draw on our recent working paper to ...
Briefing
Hiring Puzzle: Why Do Firms Decrease Hiring So Much in Recessions?
The unemployment rate fluctuates with the business cycle, rising and falling as economic activity changes: Businesses increase hiring during expansions (causing unemployment to decline), and they reduce their hiring efforts during recessions (leading to persistently high unemployment rates). Productivity shocks are the main driver of the business cycle, but are these productivity fluctuations also the sole driver of such employment cycles? In this article, I discuss my recent work showing that productivity fluctuations alone are insufficient to explain employment fluctuations.