Edward Lazear writes that while the job market has “improved significantly” since the end of the Great Recession, it’s also “far” from recovered:
Reductions in employment during recessions come about primarily because the hiring rate declines, not because layoffs pick up. It is easy to cut employment to recession levels simply by a freeze in hiring for a month or two. It is the number of hires that tells us how close we are to getting back to pre-recession levels.
The data released last week showed that hires reached 4.8 million in June, the highest since February 2008.
This is good news. During the recession and first three years of the recovery, hires averaged about 4.2 million per month.
Nevertheless, before the 2007 recession began, hiring peaked at 5.5 million per month and averaged 5.1 million a month from 2000 through 2007.
The labor force is larger now, so more hires are needed, specifically about 5.2 million in the average month. We are just past the halfway point in getting hiring back to normal levels.
After five years of “recovery.”