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There's a lot more slack in the American labor market

This chart was inspired by the wonderful FRED blog, and it shows a lot more slack in the American labor market than the record-low unemployment rate would suggest.

The bottom line: America hasn't run out of workers, not even close. Unemployment might be low, but employment could rise significantly from its current levels.

  • If you're a working-age American, you're less likely to have a job now than you were pre-crisis. And you were significantly less likely to have a job pre-crisis than you were during the Clinton boom of the late 199os.
  • The equivalent numbers in Japan show that this isn't a story of demographic inevitability. More working-age Japanese have jobs today than at any point in the country's history. Today's employment rate in Japan is also significantly higher than the employment rate at any point in American history.