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Briefing
Aggregate Effects of the Adoption of AI
AI is holding out the prospect of substantial productivity improvements. While the potential of AI may be large, it is uncertain how much of that potential will be realized and how fast it will occur. Recent estimates of the medium-term AI impact on labor productivity range from negligible to larger than the 1990s IT impact. But should AI meaningfully affect medium-term productivity growth, monetary policy is likely to respond by accommodating the increase in potential output. On the other hand, recalling the 1990s IT diffusion, one should not be too surprised that, even though AI is ...
Discussion Paper
Who Is Supplying the Labor for Recent Employment Growth in the Rural Fifth District?
Although many rural counties in the Fifth District have experienced population growth since 2020, total population has shrunk in rural areas. Rural regions in the United States have long experienced demographic squeezes as older people tend to stay in place and younger people migrate to metropolitan areas. But has the rural labor supply fared better since the COVID-19 pandemic? This post explores how changes in total population, out-of-the-labor-force population, and unemployment explain employment growth across the Fifth District's rural counties. In aggregate, rural counties have ...
Journal Article
Research Spotlight: Skill Mismatch, Layoffs, and Bouncing Back
Being laid off from one's job often leads to worse future employment outcomes. The underlying reasons for this are unclear, however. Recent research by Richmond Fed Economist Claudia Macaluso has found that mismatch between a laid-off worker's skills and the skills involved in other local jobs plays a significant role. She created a novel measurement of "local skill remoteness" and used it to compare the effects of layoffs from jobs with varying levels of this skill remoteness on a worker's wages, future employment, and migration.