A Look at Jobless Recoveries in G7 Countries

49 Pages Posted: 3 Oct 2019 Last revised: 25 Mar 2020

See all articles by Ahmed W. Elroukh

Ahmed W. Elroukh

Lehigh University

Alex Nikolsko‐Rzhevskyy

Lehigh University - Business School

Irina Panovska

University of Texas at Dallas

Date Written: March 24, 2020

Abstract

We study changes in the plucking behavior of employment growth, as well as changes in its relationship with the output cycle in the G7 countries. Using both revised and real-time data, we consider several popular measures of the output cycle. For most countries, we see significant evidence in favor of structural changes in the response coefficients of employment growth to its own gap, suggesting much slower recoveries in labor markets, consistent with the jobless recoveries hypothesis. However, we also find evidence in favor of heterogeneity across countries, both in the responses of employment to employment gaps and in the responses of employment to the output cycle.

Keywords: nonlinear business cycles, employment, G7, joblessness, plucking

JEL Classification: E24, E32

Suggested Citation

Elroukh, Ahmed W. and Nikolsko-Rzhevskyy, Alex and Panovska, Irina, A Look at Jobless Recoveries in G7 Countries (March 24, 2020). Available at SSRN: https://ssrn.com/abstract=3459160 or http://dx.doi.org/10.2139/ssrn.3459160

Ahmed W. Elroukh

Lehigh University ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

Alex Nikolsko-Rzhevskyy

Lehigh University - Business School ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

HOME PAGE: http://www.nikolsko-rzhevskyy.com

Irina Panovska (Contact Author)

University of Texas at Dallas ( email )

2601 North Floyd Road
Richardson, TX 75083
United States

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