Jobless recovery

A jobless recovery or jobless growth is a phrase used by economists to describe the recovery from a recession which does not produce strong growth in employment. The phrase originated in the early 1990s in the United States, to describe the economic recovery at the end of President George H.W. Bush's term; it came back into use during the early 2000s.

Prior to the 1990s, most economic recoveries led to employment increases relatively rapidly. However, starting with the 1991 recession the employment recoveries have been historically slow.

Economists are still divided about the causes and cures of a jobless recovery: some argue that increased productivity through automation and robotics has allowed economic growth without reducing unemployment. Other economists [http://www.newyorkfed.org/research/current_issues/ci9-8.html] suggest that jobless recoveries stem from structural change in the labor market, leading to unemployment as workers change jobs or industries.

Free trade has also been suggested as a possible cause. In this view, during lean times companies are more likely to move factories and jobs offshore to cut costs. These jobs generally don't come back after the economy improves. Offshoring is considered bad for employee morale such that it is done slowly and with caution during times when economics are good because companies do not want to upset employees. However, during a recession, the fear of losing a job keeps employees from leaving, and thus more tolerant of offshoring.