On US jobless recovery

We have mentioned in previous post that many economies of the World are suffering jobless recovery, Mexico and United States are two examples that we have analyzed here and here. In this article Professor Rajan argues that there is an additional piece of information that should be taken into account to understand the jobless recovery (based on the work of researcher professor Hurst). The new piece of information is that unemployment in the construction industry account for aproximately 3 per cent of the 9 per cent unemployment rate, and that it will not decrease in the short run since it is not expected that the construction industry will grow sufficiently in the next months. Rajan, based on these findings, goes further and suggest the government to avoid implementing stimulus packages that have very little effect on unemployment.