From the director: Bringing the past into focus

It has been an active year in the U.S. economy. Many have been watching for clues to the economy’s direction on an almost daily basis. That kind of vigilance is important in many sectors and of course at the Fed. But the drivers of economic opportunity and inclusive growth often only come into view over time. As a result, the Institute is particularly invested in taking the long view.

In this issue of For All, we take the long view on several trends characterizing the U.S. economy.

For decades, women’s participation in the labor market rose steadily, but this plateaued in the 1990s. How did this rise and eventual flattening affect the economy? Work by former Institute visitor Stefania Albanesi finds that the growing participation of women in the labor force contributed to faster employment recoveries following recessions. The stabilization of that rise resulted in slower employment recoveries, which has characterized most recessions since then and influenced policy responses.

In our cover article, Andrew Goodman-Bacon and I investigate long-term unemployment—both its recent movements and its longer history. We show that the rapid recovery of long-term unemployment to its current level is a departure from historic patterns, and we consider whether this severe form of unemployment might revert to its historic cycle going forward.

We also discuss the potential economic implications of AI over the long run with Institute advisor Erik Hurst and look at research by San Francisco Fed economists on why the college wage premium—one of the most striking examples of rising inequality—stopped rising after three decades of growth.

Analyses like these rely on data to compare our economy today with the past. This is best facilitated by professional researchers with a mission to collect and share comparable data and statistical information over time. This issue, as well as many of the resources on minneapolisfed.org/institute, show what we can learn from such data. Without them, the long view would quickly blur until it is unrecognizably out of focus.

This article is featured in the Fall 2025 issue of For All, the magazine of the Opportunity & Inclusive Growth Institute