Atlanta Fed 2013 Annual Report: Where Are the Jobs?

Federal Reserve Bank of Atlanta 2013 Annual Report


In the nearly five years since the recession ended, we have recovered a lot of ground in the labor market. But we still are far short of replacing the 8.7 million lost jobs.



The Atlanta Fed is exploring the labor market in a lively and interactive format designed to bring to life a timely and important topic: where are the jobs?


Where Does the Labor Market Stand?

The labor market has been recovering slowly. We look at vital signs, including recent employment growth and unemployment and some of the key ingredients of both. Labor force participation has been a particular concern for economists and policymakers.

  • Jobs in private service–providing industries came back relatively quickly, while other major sectors, notably manufacturing, construction, and government, lagged.

  • How much of the improvement in the unemployment rate is due to declining labor force participation? A falling unemployment rate does not necessarily mean a healing labor market.

  • The unemployment rate has improved considerably since the recession ended, but other labor market indicators showed less progress.

  • By the end of 2013, the United States had regained 87 percent of lost jobs; the Southeast had reclaimed only 62 percent.


      Employment Gains by Industry Sector









    • The jobs recovery continued to be uneven across economic sectors in 2013.

      Source: U.S. Bureau of Labor Statistics

      Labor Force Participation Rates, by Age, as of December 2013

    • 62.8%
      Civilian labor force
    • 54.8%
      16 to 24 years
    • 80.7%
      25 to 54 years
    • 39.9%
      55 years and over
    • In December 2013, the labor force participation rate fell back to its lowest level since 1978. When broken down by age group, labor force participation varies widely.

      Source: U.S. Bureau of Labor Statistics

      Unemployment Rates at Key Points in the Business Cycle

    • The unemployment rate has improved significantly since peaking at 10 percent in 2010. However, labor markets still have a long way to go before completely reversing the increase in unemployment caused by the recession.

      Source: U.S. Bureau of Labor Statistics

What's Holding Back Job Growth?

General economic weakness in the wake of a severe financial crisis is perhaps the biggest reason the labor market has not rebounded more quickly. Yet there is no single, simple answer to this question. We examine a few of the particular forces that continued to limit employment growth during 2013.

  • While it's clear that polarization in the labor market has occurred over the decades, it's not clear whether it accelerated during the Great Recession.

  • Skills mismatch may be part of the story for the slow job growth that the economy has experienced, but it's not the full story.

  • The Atlanta Fed has investigated trends in a variety of firm types to better understand why labor market progress continued to be slow in 2013.

  • The past several years have been marked by high levels of policy-related uncertainty. How has this affected the economy?


"In its monetary policy responsibilities, the Fed is tasked with promoting stable prices and maximum employment."

Dennis Lockhart, President and Chief Executive Officer

How Do We Get More Jobs?

Stronger economic conditions, along with astute monetary and fiscal policy, can help accelerate job creation. Some of those conditions and policies are already in place. Some policies are widely accepted. Others are contentious and thus difficult to achieve.

  • With the appropriate monetary policy, the Federal Open Market Committee expected that the jobless rate would gradually decline toward levels the Committee judges consistent with its dual mandate.

  • The good news was that the worst of the fiscal drag appeared to be over as 2013 ended. And the fiscal situations of states and municipalities generally improved.

  • Watching inflation and wage growth can help gauge whether the economy is gathering the underlying strength it needs to quicken the healing of the labor market.



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