A: No one can honestly answer this because the economy is too complex. Beware those who try to explain this with soundbites (like politicians). They're either liars or lying to themselves.
Economic principles are a different matter. These don't change. Beware economic explanations (and prescriptions) that fly in the face of economic principles.
Just because we can't know everything about an economy, doesn't mean we shouldn't try to learn what we can and speculate about different causes. Ok, the official unemployment rate is low. Why? Is this a good indication of the overall happiness that people have with their jobs? If so, why is Bernie Sanders so popular? I suspect there is a large segment of the population that is not happy with their economic situation.
Statistics often give a false sense of knowledge. The so-called labor participation rate is low, which means many people are simply not counted. Should they be? Are these people happily retired at an early age, living on welfare, living in a friend's basement, or earning a lucrative living in the black market?
On the other side, there are clearly a lot of employers who aren't happy. They have positions to fill, but can't find skilled workers. Tighter immigration policies that impact high-skilled workers may be exacerbating this situation. Our socialized education system is not helping.
Then there's this nasty thing call the boom-bust cycle. It happens when the central bank artificially lowers rates, causing asset bubbles and an unsustainable boom. Sound familiar? The official unemployment rates is ALWAYS low when this happens. That of course reverses with the bust.
It's complicated...
~ Kevin Duffy, answer to Facebook question, February 19, 2020
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