Reasons for Jobless Recoveries

[Beet]

That makes sense theoretically, but it does not fully explain the original poster's question; if fast productivity growth was necessarily a cause of 'jobless recoveries'; or rather, a permanent sub-job (i.e., subpar jobs) economy, then we would have expected high unemployment during expansion that had high productivity growth. As we know this is not true. In the World Economy Between the Wars, productivity growth for 1950-73 is listed as 4.77 for Western Europe, 2.77 for the United States, and 7.74 for Japan, compared to 1.56, 2.48, and 1.80 respectively for 1913-1950, when unemployment was much higher.

Could the safety of the dollar be creating some kind of "premium" that keeps the dollar overvalued, both directly (through currency pegs) and indirectly (on the so-called 'free [currency] market') which in turns encourages Americans towards borrowing at the cost of producing? For it makes borrowing cheaper and producing less lucrative. In a perverse way, the world is trying to 'repay' America for the currency safety we provide by lending and selling to us at a discount. This in turn creates distortions in the domestic economy.

[Beet]

That makes sense theoretically, but it does not fully explain the original poster's question; if fast productivity growth was necessarily a cause of 'jobless recoveries'; or rather, a permanent sub-job (i.e., subpar jobs) economy, then we would have expected high unemployment during expansion that had high productivity growth. As we know this is not true. In the World Economy Between the Wars, productivity growth for 1950-73 is listed as 4.77 for Western Europe, 2.77 for the United States, and 7.74 for Japan, compared to 1.56, 2.48, and 1.80 respectively for 1913-1950, when unemployment was much higher.

I think it may be the changing nature of productivity from earlier recoveries to modern recoveries.

I think around the 1970s, technological improvements (and additional capital investments) complemented labor, so as firms could scale up production they could employ both capital and labor in increasing amounts.

While modern-day, technological improvements we see that technology (coupled with globalization, as mentioned above) can outright substitute for labor in many cases.

Interesting, and a plausible explanation. What technological improvements complemented labor before the 1970's and now substitute for labor?

[Beet]

I think what he is saying is that we should increase social welfare benefits so that being unemployed doesn't hinder your ability to be a housewife, go to school or life a comfortable life.

Oh wait it's Philip, never mind.