The End of (Mail) Men

Here above you can see a persistant drag on the labor market in the form of the steady decline in the number of people employed by the U.S. Postal Service. As you can see this is a political/technological phenomenon that long predates the recession, but larger economic problems seem to have exacerbated the decline.

This also helps you remember one of the ways that short-term unemployment has long-term costs. Even when the economy’s quite healthy, there’s always someting like this happening. Some industry that’s changing or declining and some class of workers losing their jobs. If aggregate demand is high and unemployment is low, what happens then is that employers in growing industries are eager to catch the folks falling out of declining ones. They’re out there on the prowl, hunting for available labor. As a side-effect of their own voracious appetite for workers, people gain information (about what places and industries and specific occupations need workers) and they gain skills (as people get trained for in-demand occupations or learn firm-specific skills related to growing firms). But when overall demand is weak, this loop is cut. Knowledge about how to do the job of a postal worker gets less and less valuable with every passing day, but the people who are overinvested in that skillset aren’t bombarded with alternate knowledge. So when you let the labor market weakness linger, you end up dealing a permanent blow to human capital.