Sunday, March 28, 2010
The Jobs Puzzle Bernanke Can't Solve
This article focuses on several comments made by Fed Chairman Ben Bernanke made during questioning at a Congress hearing. The chairman gave two reasons of why jobs have not been on the rebound with the economy. I prefer the latter reason, which is "The other is that the productivity gains were greater than we thought they would be when firms were able to cut their work forces and still maintain output." This means that as times got rough starting in 2007, firms recognized this and adjusted their operations to still produce output and keep costs low. Two other economists also argue that GDI rather than GDP should be used as a measurement for the economy.
Subscribe to:
Post Comments (Atom)
1 comment:
If it is the case that GDI is a better measurement, then this looks more promising for the job market since GDI increased in the fourth quarter of last year. Hopefully there will be large job gains but the article explains that the unemployment rate will still continue to increase at the end of this year as discouraged workers begin the job search again. I think that hiring temporary workers is a good idea because companies may see that hiring more workers may benefit them.
Post a Comment