Abstract
After reaching a high of 10.6% during the 4th quarter of 1982, the US' unemployment rate dropped 3.1 percentage points during the next 6 quarters. This was a decline more rapid than achieved during the first 6 quarters of any recovery since the Korean War. The main reason that the unemployment rate has dropped so quickly is that the economy has been creating jobs at an unusually rapid pace. Private sector employment has increased 7% since the 1981-1982 period. Businesses have expanded employment to keep pace with growing demand for their output. Also contributing to the large decrease in the unemployment rate has been a lower average growth in the labor force due to a decline in the number of teenagers of working age. It is projected that, as the current recovery progresses, employment growth will slow because growth in output will slow.