The responses of working hours and employment levels to temporary negative demand shocks like those caused by the Great Recession in 2007-2008 and the Covid-19 pandemic in 2020-2022 have shown that consideration of both is important. Workers' desired rises in working hours in times of recession...

Persistent unemployment after recessions and the policies required to bring it down are the subject of an ongoing debate. One view suggests there are fundamental changes in the labor market that imply a long-term higher rate of unemployment, requiring the implementation of structural policy...

The aggregate neoclassical growth model - with a labor income tax or "labor market distortion" that began growing at the end of 2007 as its only impulse - produces time series for aggregate labor usage, consumption, investment, and real GDP that closely resemble actual U.S. time series. Of...

The continuing adverse labor market effects of the Great Recession have intensified interest in policy efforts to spur job creation. In periods when labor demand and supply are in balance, either hiring credits or worker subsidies can be used to boost employment - hiring credits by reducing...

The employment and hours worked of young individuals fluctuate much more over the business cycle than those of prime-aged individuals. Understanding the mechanism underlying this observation is key to explaining the volatility of aggregate hours over the cycle. We argue that the joint behavior...

Concave hiring rules imply that firms respond more to bad shocks than to good shocks. They provide a unified explanation for several seemingly unrelated facts about employment growth in macro and micro data. In particular, they generate countercyclical movement in both aggregate conditional...

Many economists suspect that downward nominal wage rigidities in ongoing labor contracts are an important source of employment fluctuations over the business cycle but there is little direct empirical evidence on this conjecture. This paper compares three occupations in the housing sector with...

This paper finds that US employment changed differently relative to output in the Great Recession and recovery than in most other advanced countries or in the US in earlier recessions. Instead of hoarding labor, US firms reduced employment proportionately more than output in the Great Recession,...

In models recently published by several influential macroeconomic theorists, rigidity in the real wages that firms pay newly hired workers plays a crucial role in generating realistically large cyclical fluctuations in unemployment. There is remarkably little evidence, however, on whether...

Every year has large demand and supply shifts associated with the seasons, regardless of the phase of the business cycle. Based on measures dating back to the 1940s, the seasonal shifts reject the hypotheses that demand shifts affect employment outcomes significantly more in recession years than...