- Common metrics for measuring the labor market—such as the unemployment rate—often underestimate the number of people available for work and thus the growth potential of the economy and the need for public investment to achieve an economy that works for everyone.
- Based on models that correct for pervasive racial, educational, and gender discrimination, we find that with sustained strong demand, a 68 percent employment rate is possible by 2031 (compared to the CBO’s 58.2 percent projection); that’s equivalent to 28 million more jobs.
- With this new benchmark, we can achieve a level of growth capable of reducing discrimination in the job market and shrink race, education, and gender employment gaps.
- To reach true full employment, the government must continue making essential investments in long-neglected spheres like climate and childcare—which will permanently increase labor force participation and accelerate innovation and productivity.
As the US economy begins to recover from COVID-19, we are poised for a period of faster economic growth than we have seen in decades. The extraordinary stimulus measures of the American Rescue Plan were vital in staving off economic disaster, but additional federal investment now can produce long-term growth and a tighter labor market that benefits everyone. As J.W. Mason, Mike Konczal, and Lauren Melodia write in “Reimagining Full Employment: 28 Million More Jobs and a More Equal Economy,” if we manage the boom rather than fight it, the US can reach true full employment and reduce racial and gender inequalities in the labor market.