Unemployment Fluctuations in the United States: Further Tests of the Sectoral-Shifts Hypothesis.

This paper presents further evidence on the importance of sectoral shifts by examining unemployment fluctuations in the United States over the period 1960 to 1991, extending previous research in three directions: first, by using a thirty-industry decomposition of quarterly nonagricultural employment; second, by employing modern time-series econometric techniques; and third, by using dispersion measures purged of both monetary and aggregate demand influences. The authors' findings support the view that sectoral shifts have been an important element of fluctuations in U.S. employment and also indicate that a given amount of dispersion has been associated with more unemployment during downturns than upturns. Copyright 1995 by MIT Press.