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The Atlanta Fed's macroblog provides commentary and analysis on economic topics including monetary policy, macroeconomic developments, inflation, labor economics, and financial issues.

Authors for macroblog are Dave Altig, John Robertson, and other Atlanta Fed economists and researchers.


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December 23, 2014


Chances of Finding Full-Time Employment Have Improved

Today's sharp upward revision to the third-quarter GDP reading reinforces the view that the underlying strength of the U.S. economy has been sufficient to support more rapid improvement in the labor market. Last week we noted the solid and broad-based recent improvement in the involuntary part-time work (part-time for economic reasons or PTER) situation over the last year, noting significant declines in the stock of PTER workers across industrial sectors and occupational categories. 

In this post we look at labor market improvement over the last year in terms of worker flows. Because the Current Population Survey is set up as a rotating panel, many of the people in the survey in any given month were in the survey a year earlier as well. This allows us to ask the question: if you were an unemployed prime-age individual (25–54 years old) or working PTER one year ago, what are you doing today? Have your chances of becoming employed full-time improved? Chart 1 shows the distribution of labor market outcomes of prime-age workers who were PTER one year earlier. Chart 2 shows the distribution of outcomes for those who were unemployed one year earlier. The data are 12-month moving averages to smooth out seasonal variation.

Macroblog_2014-12-23_chart1

Macroblog_2014-12-23_chart2

For both PTER workers and the unemployed, the chances of becoming employed full-time are up from a year earlier (and the chances of being unemployed are down). In November 2013 there was about a 45 percent chance of someone who was PTER a year earlier having a full-time job. In November 2014 that had improved to about a 48 percent chance. This full-time employment flow rate is still much lower than the prerecession average of around 55 percent, and the improvement appears to have stalled a bit in recent months, but it is a notable improvement from a year earlier nonetheless. For PTER workers, the picture along other dimensions is more mixed. The chances of becoming unemployed appear to have returned to around prerecession levels, which is good, but the likelihood of remaining PTER is still quite elevated.

For the unemployed, there has been an even more marked improvement in the full-time finding rate over the last year. In November 2013 there was around a 32 percent chance of someone who was unemployed a year earlier having a full-time job. In November 2014 the chances improved to close to 36 percent. Moreover, the improvement in the rate of finding full-time work is responsible for the similar-sized decline in the chances of remaining unemployed. The only negative here is that the likelihood of an unemployed worker becoming PTER, while low, remains elevated compared with before the recession.

All in all, we think these developments are encouraging and add to the view that the pace of labor market improvement has picked up over the last year.

Happy holidays!

December 23, 2014 in Economic conditions , Employment , Labor Markets | Permalink

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Comments

This seems to be good news, but as a job seeker, I can tell you from the trenches that the jobs of 2014 are very different from the jobs of 2006. Jobs that used to have a base+commission+benefits are now fully commissioned and carry "self funded" benefits in the new lingo. Many of the people I know wearing suits and going to work every day are putting in 70 hours per week and not even making minimum wage. And I can further tell you that in the positions I'm applying for, I'm hearing back from HR dept's that they're getting hundreds of applications for any job they post. These are not the signs of a robust economy.

Posted by: Todd G. | December 24, 2014 at 11:16 AM

Within the last 12 months, if you were laid off, you would not be "long-long-term unemployed" — whereas several million other jobless Americans would be — and a significant number (who still want jobs) are no longer in the labor force. So if you were unemployed less than a year ago, or are currently working a part-time job (when preferring full-time work), then maybe the chance for YOU finding a full-time might have increased somewhat from a year ago. But if you were laid off in 2008, 2009, 2010, 2011, and 2012 (and still without a job) your chances haven't improved at all.

Posted by: Bud Meyers | December 24, 2014 at 12:22 PM

What happened back then cannot happen today...the jobs back then are different from now even if they are the same

Posted by: Tan | February 16, 2015 at 08:10 AM

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