GDP Growth vs. Employment Growth

At last, the level of real GDP has rebounded past its previous peak in the fourth quarter of 2007.  Clearly, the trough for employment was both much deeper and trailed that for GDP.  In contrast, the recovery for real GDP has been more rapid as well.   Financial repression (extremely low interest rates) must be part of the story behind this chart.  Clearly, an increased cost of labor relative to capital induced a capital intensive recovery.

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