Economic Threads: Diving Into The Labor Markets


This podcast script includes fictitious interviews with public figures or actual persons who are not team members. Any resemblance to real persons, living or dead, is purely coincidental.*



Greetings, listeners, to the Business Boys’ Brotherhood! Welcome to a special episode of Economic Threads! My co-hosts, Cyrus Andaz and Michael Bank, join me. Today, we’ll embark on a rich journey into labor economics. Remember to stick to the end because we have a special someone in the building today!

That’s right! From ancient times until today, work has been the backbone of the economy, and understanding its complexities is crucial for understanding the broader economic landscape.

Our exploration today is not just about facts and figures; it’s about unraveling the threads of the economy and opening your eyes to the endless possibilities within the intricacies of jobs’ impact on the economy. 

Cyrus Andaz:

The nature of work and labor has transformed and evolved for thousands of years. From hunter-gatherers to the Industrial Revolution and now the age of generative A.I., the job market is perpetually morphing with the creation of new skills, jobs, and livelihoods. 8 

Our journey begins by acknowledging the historical context of work and its transformative impact on societies.

As we begin to talk about employment, the first thing we must analyze is the difference between the two main categories of jobs. These are, of course, the standard Blue-collar and White-collar positions. 

Michael Bank:

Forbes provides a better understanding of what precisely blue and white-collar jobs are, first setting the stage with blue-collar jobs. These individuals most often engage in manual labor, typically in the agriculture, manufacturing, construction, mining, or maintenance sectors. They are either skilled or unskilled, depending on whether they have been to trade school or not, and are generally paid hourly. These jobs are known to be more physically demanding than white-collar jobs. 

Now, let’s take a look at white-collar jobs. Investopedia says white-collar jobs are traditionally “Found in office settings. As the name implies, they are generally suit-and-tie workers who wear white-collared shirts. Their jobs may involve working at a desk in clerical, administrative, or management settings.” Some examples you may recognize include an accountant, attorney, data entry clerk, account manager, and more. 1 

Ultimately, the combination of these jobs is pertinent to sustaining the economy, and following the radical shifts in how they have developed over the years is critical to understanding the current financial state of the world. Let’s all take some time to look into a specific job to showcase the immense evolution presented within a day-to-day job that we’ve witnessed throughout the years. Today, we have chosen to look over the transformation of accounting. 

Farhan Rashid: 

So, branching off what my colleague said, accountants’ jobs have existed since dawn. Records from 8000 BCE to 5000 BCE uncover evidence of accounting language from Mesopotamian civilizations.

 Now, of course, the role of a white-collar worker today doesn’t look the same as it did thousands of years ago, so let’s jump to an early point of white-collar work as we know it when the AAPA was first established as the association of public accountants in 1887. Then, in the mauve decade, 1896, is when accounting officially became a recognized profession. 2 

 Let’s closely examine the accountant’s position to use as a model for other parts of the job market. The simple explanation provided by Maryville University is how accountants came from black and white, the simple record books into color, and the sophisticated systems of checks and balances. Accounting has a rich technological history. Accounting was one of the first sectors to implement computers as a regular work tool in 1955. This expanded into the first spreadsheet software, Visicalc, in 1978. Further advanced in 1998, the development of Quickbooks, a software that made it universally easier for accountants to handle bookkeeping .3

 While these developments were revolutionary, today, accountants take advantage of cloud storage, digital payments, A.I., and machine learning. These new and advanced instruments allow them to analyze large volumes of data efficiently and accurately. 

Cyrus Andaz:

As we move on from the overall picture of what a job is exactly. I want to mention what an ideal economy looks like for the FED, the central banking system of the United States. The Fed uses the system and the tools it has to set interest rates and regulate the money supply to accomplish its mandate of price stability and maximum employment.18 

The proposition of the “dual Mandate” by the FED pictures the economy with a 2% inflation mark using data from PCE, personal consumption expenditures, and maximizing employment with rates of unemployment to be situated as low as possible, which is 3-5% more specifically. They do this because those are significant catalysts and indicators for a high-rising economy, with price stabilization and work fueling it. 7,9

With every plan comes bumps in the road; this is where the past two years come into play, temporarily showcasing a push away from the dual mandate. They are explained methodically by Greg Ip, a chief economics commentator at the Wall Street Journal, mentioning how the FED had to essentially ditch the dual mandate and stick to one side of the balance. So they picked inflation due to its loss of purchasing power ramifications and cataclysmic results if left. This was at a time when inflation was soaring over 9%. Since then, inflation has dropped off a cliff down to 3.1% as of Jan 2024.6

With this in mind, Greg further stated how, as of right now, this economic inflation “Is within shouting distance of the Fed’s 2% target, and the Fed can now say it is not the clear and present danger it was, we can go back to worrying about both things now. And so what that means is that if they see signs that the job market is in danger, you’ll start to see them cutting interest rates, even if they’re not fully back to the 2% inflation that they target.” 5, 7

Balancing and achieving equilibrium within the “dual mandate” is tricky. It’s tricky when unemployment drops significantly; it leads to higher inflation, according to the Phillips curve, which suggests an inverse relationship. Contradicting one another causes the FED to struggle to achieve a “Dual mandate.” 10

Michael Bank: 

Before discussing the unemployment rates, let’s cover a significant aspect of employment: employability. This combination of skills, knowledge, and personal attributes makes an individual suitable for employment and capable of maintaining and advancing in the workforce. It is for the employees to continuously adapt and enhance their skills to meet the demands of employers.20 

You may ask yourself why this is important to the general labor force and market. Well, low employability tends to create structural unemployment, the longer-lasting version of unemployment caused by factors in the same realm as low employability, which directly affects GDP in the long run.17 

Employability throughout the ages has been loosely tied to the higher the education level, the more employable you are. Still, research shows that today’s society has undergone a massive transition within the employability sector. This now favors an individual’s vast array of specific combinations of discipline-specific skills, extracurricular activities, competencies, and attributes rather than just the degree to validate your employability. 19

Cyrus Andaz:

As we go into 2024, as mentioned earlier, inflation has dropped significantly, leaning for the FED to move its attention away from the impending crisis within inflation to unemployment. This will again balance the dual mandate, which is uber-hard to accomplish.

However, they would only focus on unemployment if there seems to be a crisis or a significant problem emerging. The question arises – how exactly do economists measure unemployment? How can they predict the current and future trends?

To begin, if any of our listeners want the most recent scoop or development within unemployment, go to The U.S. Bureau of Labor Statistics (BLS), where you can find all the most relevant updates. 12  

Economists at the BLS conduct analysis to properly direct research into unemployment rates by understanding “exceptions,” like full-time college students, retired people, children, etc. These individuals are considered “out of the labor force.” To be considered unemployed, one must actively search for a job.

Now that we understand who belongs to which category, it’s time to dive deep into calculations. The three divisions are “Out of the Labor Force,” “Employed,” and “Unemployed” individuals, as alluded to previously. The total labor force includes only the latter two of these groups. The equation for calculating unemployment is Unemployed People / Total Labor Force * 100. 21 

To calculate this number, The Bureau of Labor Statistics conducts the Current Population Survey (CPS) monthly to determine the national unemployment rate, involving a sample of roughly 60,000 households across 729 selected areas. The survey captures various demographic factors and detailed information on unemployment – a rich resource for understanding labor trends. 

Farhan Rashid:

Now that we have discussed the measures involved in assessing unemployment let’s see what that “ideal” or a “model” economy with balanced inflation and unemployment at its lowest potential is possible. 

The most optimal employment fuels economic growth, helping push GDP, the gross domestic product, a measure of America’s economic output, to higher levels yearly. This grew by 2.5% annually in 2023, compared to 1.9% in 2022, partly due to employment. 16 

This is caused when high employment occurs; it tends to maintain solid spending levels that keep the economy growing even amid high inflation and skyrocketing interest rates. 15

The Interview.

Bank: So, today on Business Boys Brotherhood, we are excited to have a distinguished and special guest, Jerome “Give-Me-My-Money-Back” Powell Jr., reporting in. We will ask him an assortment of questions to dive deep into the current labor economic state of the USA.

Andaz: Mr. Powell, welcome to the Business Boys Brotherhood; finally, meeting you in person is great! I’m Cyrus Andaz, and my two co-hosts are the fantastic Farhan Rashid and the marvelous Michael Bank. We’re excited to learn from you and hope you feel welcome with us.

Jerome Powell Jr: 

Thank you so much for the warm greeting. Oh, why? Yes, this is a beautiful place you have here. You should be proud of yourselves. I’m all for this. Start your way with the interview. 


Taking where Cyrus left off, today, Jerome Powell Jr, we will be going through a surplus of questions analyzing your opinion and insights on the labor markets right now. What is your view on the labor force and its situation as of March 14, 2024?

Powell: Currently, unemployment rates are at a great place. Between that 3-5% mark, which is superb, consecutive gains of over 2.7 million jobs have been created for the past three years. 22 This helps me feel a little less weight off my shoulders due to the robust employment data through the past years. But, recently, some concerning news has come to my attention. As of a week ago, news reported that jobs data contradicted the January “jobs report” in the nonfarm payroll, with an actuality of 229,000 jobs created rather than the 353,000 initially reported. 21. This coupled with the fact that layoffs have jumped drastically, with this February marking its highest percentage of layoffs since any February since 2009. On top of all that, in the past year, from February of 2023, it steadily increased from 3.6-3.9% to February 2024 and, in the past month, jumped 0.2%. 22  Unemployment has risen steadily for the past year. However, it’s still at a point where I don’t have overwhelming concerns due to it being situated in a desired area, even though it could grow to something weakening the economy’s overall status. 23 

Rashid: Hypothetically, if unemployment worsens, what measures will you take to combat that looming issue? 

Powell: Well, where we stand today, unemployment is relatively low. But if it were to rise again, god forbid, we would have numerous tools at our disposal that we could use. One of the main things we can enact is monetary policy, which spews more money into the economy by printing money and making borrowing cheaper for banks. Also, lowering interest rates can pass on lower borrowing costs to consumers and businesses, thus encouraging spending and investments and creating jobs. I plan to keep the unemployment percentage relatively low and the nonfarm payroll employment rate as high as possible. 24. 25

Rashid: What will be your main focus if it stays the same and heads in the right direction?

Powell: That’s a fascinating question with some complex layers. If we keep the gas on the pedal the way we have it, I can see our economy bolstering. There would be no reason to intervene unnecessarily, especially if inflation and unemployment are balanced. On the contrary, if unemployment begins to decrease, it could create a phenomenon where inflation could see a spike. In times of low employment, employers typically pay higher wages to attract employees, ultimately leading to rising wage inflation. 11 This directly leads to higher prices for products and services within our country. This is unlikely to happen as our economy presents itself, but we must always prepare ourselves for worst-case scenarios. With that in mind, I would rethink cutting interest rates but stay at a pause or even bump up interest rates. If unemployment does cause a spike in inflation because they are lower than the 3-5% favored mark, I see no reason to tag on an interest rate hike. 

Rashid: As we enter the 21st century, working is profoundly evolving, specifically regarding the newfound A.I. craze and the ramp-up in new technological advancements. With all this hype surrounding A.I. and such, what might we see jobs in the future look like with this incorporated into our daily lives? Will there be positions of revoked employment, and will there be the creation of jobs? 

Powell: A.I., in my eyes and many others, will significantly impact routine, manual jobs, and more, and will be most focused on transactional tasks. A study showed that I read a while back that automation could take over tasks accounting for 29.5 percent of the hours worked in the U.S. economy by 2030, up from 21.5 percent without generative A.I. As I see it, A.I. will add significant healthcare, STEM, and managerial positions and fewer jobs in customer service, office support, and food services. With these new additions in jobs ultimately overlapping the removal of specific jobs, it keeps stressing the importance of governments, companies, and individuals to understand these shifts for the plan in the future. 

Rashid: Thank you so much for this fantastic opportunity to interview you. To end the day well, let’s be lighthearted and tell me your favorite economic joke. 

Powell: I sure would tell you an economics joke, but there is no demand!! 

Andaz, Bank, Rashid: (Laughs) You are genuinely one of a kind, Mr. Jerome Powell Jr! What a way to end today’s deep dive into the fascinating world of economics!

Andaz, Bank, Rashid: Until next time, remember that the Business Boys Brotherhood will always be thrilled to have you. 



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