Unemployed With Jobs and Without Jobs

Robert E. Hall, Marianna Kudlyak

NBER Working Paper No. 27886
Issued in October 2020, Revised in December 2020
NBER Program(s):Economic Fluctuations and Growth, Labor Studies

Potential workers are classified as unemployed if they seek work but are not working. The unemployed population contains two groups -- those with jobs and those without jobs. Those with jobs are on furlough or temporary layoff. This group expanded tremendously in April 2020. They wait out periods of non-work with the understanding that their jobs still exist and that they will be recalled. We show that the resulting recall-unemployment dissipates quickly following a spike. Potential workers without jobs constitute what we call jobless-unemployment. Shocks that elevate jobless-unemployment have much more persistent effects. Historical major adverse shocks, such as the financial crisis in 2008, created mostly jobless-unemployment and consequently caused extended periods of elevated unemployment. The pandemic of 2020 created a large volume of recall-unemployment, mostly starting in April. It largely dissipated by November. It also created a bulge in jobless-unemployment.

Acknowledgments and Disclosures

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Document Object Identifier (DOI): 10.3386/w27886