Glenn Hubbard writing in the Wall Street Journal online:
A big puzzle looms over the U.S. economy: Friday's jobs report tells us that the unemployment rate has fallen to 6.7% from a peak of 10% at the height of the Great Recession.
But at the same time, only 63.2% of Americans 16 or older are participating in the labor force, which, while up a bit in March, is down substantially since 2000.
As recently as the late 1990s, the U.S. was a nation in which employment, job creation and labor force participation went hand in hand.
That is no longer the case....
...the policy response to our disturbing doldrums in the labor market has indeed struck the wrong balance.
Whatever can be said for shorter-term measures to jump-start job creation and business activity, it seems clear by this late date that our problems are in no small part structural...
The fierce debate now going on in Washington about extending unemployment insurance and raising the minimum wage largely ignores these issues.
Such policies may affect the incomes of some Americans, but they won't do much to expand opportunity and bring more people back into the labor force. Sparking a broad-based return to the labor force demands a more ambitious agenda....
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Link: http://online.wsj.com/news/articles/SB10001424052702304441304579477341062142388?
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