…EPOP, or the employment-to-population ratio. More on that interesting connection in a moment.
As I’ve written before, this Pontiff has been a stalwart for economic and environmental justice, speaking out specifically against austerity, and calling upon governments to “relaunch the labor market.”
Well, I figure that since he gets a lot of this from my blog, I should provide His Holiness with an update on the job market. What’s more, labor economists will tell you that one useful proxy for the strength of labor market demand is employment-to-population ratio, or EPOP, which as I’ve noted, is you-know-what spelled backwards.
I use the EPOPs for 25-54 year-olds so as to not conflate retirement of the baby-boom cohort, which would lower the measure for reasons other than weak labor demand. The “prime-age” EPOP fell about five percentage points in the recession, and after crawling along the bottom for a while as the GDP recovery proceeded the jobs recovery, began to climb about four years ago.
It’s now climbed about halfway back, though the recent flattening is worrisome: the prime-age EPOP has fluctuated between 77.1 and 77.3 percent every month so far this year.
The policy implications are: no need to tap the brakes at the Fed and a great need to do more on the fiscal side. I don’t expect the Pope to join our fiscal debates—and the Planned Parenthood thing is obviously a complication for him.
But I’ll have a piece later this week arguing that one reason this EPOP recovery has been such a slog is that monetary policy can’t do it alone.