For corporations anyway. Corporate profits are back to where they were before the recession. Again, the question is why this hasn't translated into jobs and whether there is a policy government can pursue that can address that.
Here is one theory: The most obvious explanation is that the relationship between labor and capital (to borrow Marxist vocabulary) has changed. Capital has gotten stronger; labor has weakened. Economist Robert J. Gordon of Northwestern University argues that the "shift of executive compensation towards much greater use of stock options" has made corporate managers more zealous cost-cutters in recessions and more reluctant hirers early in recoveries. Lowering the head count is the quickest way to restore profits and, from there, a company's stock price.
Another, offered below, is that people are not buying anything sat the moment other than what they immediately need. They are paying down debt and saving. Companies know this and see no need to hire new workers. So there are no new jobs for people to apply for.
So here's a question for 2301s. What does this tell us about the role of government at this moment? Do we just hunker down and take lumps until personal debt levels are low enough that people start spending again? What do we do about people who can find no employment? Let them waste away? Is there a moral element here that requires intervention or not?
