The shares of a county’s employment that are in each major industry classification are correlated with the county’s poverty rate. Employment shares in healthcare and public administration, for example, are positively correlated with poverty rates, while employment shares in professional services and construction are negatively correlated with poverty rates. In this analysis, we examine some of the changes in these correlations in recent years. We will also look at the changes in industry employment that have accompanied changes in county poverty rates.
The Evolution of Household Leverage during the Recovery
Recent research has shown that geographic areas that experienced greater household deleveraging during the recession also experienced relatively severe economic contractions and slower recoveries. This analysis explores geographic variations in household debt over the past recession and recovery. It finds that regions that had very high household leverage at the start of the recession have shifted back toward national norms, while the variation of leverage within metro areas has maintained steady relationships with neighborhood characteristics such as location, demographics, and the age of the housing stock.
The Importance of Trend Inflation in the Search for Missing Disinflation
Some inflation-forecasting models based on the Phillips curve suggest that there should have been more disinflation since the Great Recession than has shown up in core PCE or core CPI data. One way researchers have found to make the disinflation disappear is to remove the long-term unemployed from the overall unemployment measure that is typically used in the models. This analysis shows that the disinflation arises in such models because of the way they account for the long-term trend in inflation. Under a different measurement of trend inflation, which historical forecast accuracy suggests should be preferable, the recent path of inflation can be reasonably well explained by an inflation-forecasting model that incorporates the overall unemployment rate.