I say that the recession continues, according to an indicator of capacity utilization in the labor market.

From March of 2001 through November of 2001 — the respective dates for the beginning and the end of the recession, according to the NBER — labor utilization fell from 97.8 percent to 94.5 percent. Since November of 2001, labor utilization has plunged still further, to 90.3 percent in July of 2003.

I describe this as a “productivity-cushioned recession.” Coincidentally, the latest figures indicate remarkably rapid gains in productivity. Bruce Bartlett remarks that this is evidence that the New Economy lives.

For Discussion. Is the utilization of labor an indicator that deserves more focus?