There is understandably a great deal of concern about the current unemployment rate -- what caused it, and especially how long it will take to have it drop to meaningful levels. However, lost in this discussion and concern, is the fact the economy has been in this exact same situation before -- in fact, we've been here after each recession since the mid 1970s recession.
Note that after the mid-1970s recession, unemployment hit 9%. After four years it dropped to 6%, but never hit 5% -- the level most economists use to describe full employment.
After the second recession of the early 1980s, unemployment was nearly 11%. It took over 5 years to get back to "full employment."
After the early 1990s recession, unemployment rose to over 7.5%. Again, it took over five years to get back to full employment.
Although the unemployment rate increased after the early 2000s recession, it didn't hit very high levels. But like the last three recoveries, it took a long time (as in nearly four years) for the unemployment rate to drop.
This commonality with previous recoveries does not make the current situation any easier, and should not be used as justification for doing nothing. However, it is important to remember we've been here before.
Noted for June 19, 2013
13 minutes ago