Goldman: “Short-Term Unemployment Is At Levels Not Seen Outside Of Major Wartime Mobilizations”

When it comes to the US labor market, it’s a tale of two extremes according to a recent report by Goldman Sachs.
At one end, the rate of short-term unemployment, defined as those unemployed fewer than 15 weeks, is lower than at any point since the Korean War and is already 0.4% below the bottom reached in the late 90s boom, with half of the gap likely due to demographic change. According to Goldman economists, “from the perspective of workers transitioning briefly between jobs whose attachment to employment is high, this is already a very tight labor market.”
At the other end, the pool of struggling workers at the margins of the labor market remains larger than in past expansions. In particular, the rate of medium- to long-term unemployment, defined as those unemployed at least 15 weeks, remains 0.75% higher than the low reached in the late 90s boom, and almost none of that gap is attributable to demographic change.
The delta between the two labor markets is shown in the chart below.

This post was published at Zero Hedge on Oct 31, 2017.