According to the National Bureau of Economic Research (NBER), what has been dubbed the Great Recession officially began in December 2007 and ended in June 2009. During this recession, national output of goods and services fell from the second quarter of 2008 until the end of the recession in the second quarter of 2009, and then slowly began to increase. When the recession was officially declared as being over, the unemployment rate continued to rise, reaching 10 percent in October 2009 and remained close to that level until April 2010 when it slowly started to decline. During that 10-month period, the net loss in jobs in the U. S. economy was close to 1.4 million. What can explain how it is possible that output can rise while at the same time employment falls?

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Business

Snoop

15 January, 07:15

According to the National Bureau of Economic Research (NBER), what has been dubbed the Great Recession officially began in December 2007 and ended in June 2009. During this recession, national output of goods and services fell from the second quarter of 2008 until the end of the recession in the second quarter of 2009, and then slowly began to increase. When the recession was officially declared as being over, the unemployment rate continued to rise, reaching 10 percent in October 2009 and remained close to that level until April 2010 when it slowly started to decline. During that 10-month period, the net loss in jobs in the U. S. economy was close to 1.4 million. What can explain how it is possible that output can rise while at the same time employment falls?

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Ricardo Campos · Answer 1

Answer: An increase in labor productivity

Explanation: In a situation where the output of each worker increases, then there will be an increase in productivity, hence there may not be any need to employ any other person except otherwise. The Labour productivity may have been enhanced as a result of technology, incentives or increase in wages, good healthcare and other things which might of prompted the workers to do more.