There's a real problem with the argument that people don't understand how good things are. If the economic data are saying that things are wonderful and people in the country are saying things are not, we need to ask what the economic data is missing.
Over time, higher minimum wages cannot help but drive capital away from business models that rely on low-productivity workers, whether that means moving the work overseas, automating it, or implementing operations that utilize higher-productivity workers instead. ... If society knew how to instill higher productivity in a worker, that could be good news. Unfortunately, our experience has been the opposite. Our education system struggles to prepare many young people for the job market. A proportion of those who enroll in higher education either fail to graduate or end up in a job that does not require their degree anyway. Government training programs perform poorly.
If the least productive workers can just disappear, policymakers achieve 'success' by dismissing the challenge that deserves greatest attention. Instead, our conception of 'productivity growth' must impose accountability for labor-market exits, recognize the value of keeping low-productivity workers connected to the job market, and have an explicit goal of ensuring that those workers are included in progress. This is doubly true because productivity measures do not fully capture the value of a job, which offers substantial non-economic benefits to many workers and may also be the best avenue for them to gain new skills and thereby increase their productivity over time. A high-productivity job requires a highly productive worker. A future filled with such jobs will materialize only if today’s less productive workers become able to do them.
The official unemployment rate instead makes each dropout from the labor force as great a success as a new hire and depicts a 'recovery? that never occurred. Only if held directly to the job growth rate, or to an unemployment rate that back-dates labor force participation to the end of the recession, will policymakers focus on the economic growth and job creation that the economy still needs. The unemployment rate today is nearly 10 percent; what are we doing about it?