New Decade, New Hopes for Job Growth

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Released: January 2011

Authors:

Adam Looney • Policy Director, The Hamilton Project; Senior Fellow, The Brookings Institution
Michael Greenstone • Director, The Hamilton Project; 3M Professor of Environmental Economics, MIT; Senior Fellow, The Brookings Institution

Introduction

The December employment numbers, released today by the U.S. Department of Labor, show signs of improvement in the labor market. The economy added 103,000 jobs last month; although encouraging after last month’s disappointing growth, this is not large enough to absorb new entrants and make a dent in the “job gap,” explained in further detail below. However, unemployment fell to 9.4 percent.

December 31st marked the end of a decade, and the three-year anniversary from the start of the Great Recession. In this month’s posting The Hamilton Project takes a step back, offering a retrospective look at trends in income and the labor market that the U.S. economy experienced over the last decade. In brief, we begin 2011 with much room to grow, as too many American workers continue to face unemployment and average wages remain largely unchanged from the beginning of the last decade.