Sluggish labor market recovery continues

The economy added just 74,000 jobs in December, and the unemployment rate fell to 6.7%, according to the Bureau of Labor Statistics (BLS).  In other words, the labor market situation is still pretty bad. Yes the unemployment rate declined during 2013, but in part it resulted from the fact that the labor force participation rate declined by 0.8% point over the year, that is less people trying to find work.

 The figure shows how the current recovery looks weak, in particular when compared to the 1990s one, and why it has been insufficient to deal with a more profound crisis (as can also be seen in the figure when compared to the milder collapse of the dot-com bubble).