Chart of the Day

ppaca & employment

My only problem with the chart is its title. I don’t think a simple bivariate correlation is enough to establish causality. But it’s a suggestive piece of evidence, since both regime uncertainty and the employer mandate associated with the PPACA are plausibly related to slowing job growth.

3 thoughts on “Chart of the Day

  1. That’s pretty damning, even if it doesn’t prove causality. Would we still have a “jobless recovery” if the original trend line continued?

  2. I don’t know, it seems to be zeroing in on a derivative of employment in order to exaggerate the shifts in job growth:

    You can make the argument that recovery slowed, but certainly we wouldn’t keep up the speed of the original recovery forever? A comparison to previous recoveries would be more interesting.

    If you look at economic output, corporate profits and the like, we appear to be in a recovery. But when you look at job growth, you get a different picture. I suspect there’s a bit of the idea of zero marginal product workers (

  3. The chart’s just suggestive, not definitive, but Yglesias is too dismissive. Of course absolute private employment will increase over time, due to the fact that the period starts with immense slack in the economy (plus, employment increases over time as the size of the labor force increases). The question is whether the trend shifts compared to what it would have been otherwise, a question that would have to be answered by looking at trends after other recoveries. But looking at the first derivative of employment is a more useful approximation of that kind of “control” than looking at the absolute level of employment – esp. since we’re still nowhere near full employment.

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