Shifts in the Beveridge curve

• Beveridge curve might not tell us if the unemployment rate is going to recover.
• The current shift in the Beveridge curve is put into context by examining the behavior of the curve since 1950.
• Outward shifts in the Beveridge curve have been common occurrences during U.S. recoveries.
• A shift is not a good predictor of whether unemployment at the end of the expansion following a shift was higher or lower than that in the preceding expansion.

We put the current shift in the Beveridge curve into context by examining the behavior of the curve since 1950. Outward shifts in the Beveridge curve have been common occurrences during U.S. recoveries. By itself, the presence of a shift has not been a good predictor of whether the unemployment rate at the end of the expansion following a shift was higher or lower than that in the preceding expansion.