American Employment under Geopolitical Risk and Dollar Strength

This study identifies certain patterns in American employment growth over the past decades. Countless shocking events have occurred and gradually faded from memory. Yet, it remains crucial to listen to the quiet voices emerging from the daily lives of firms, households, and individuals, all under the umbrella of employment. In this sense, few variables are as encompassing as employment in capturing the diverse perspectives of such heterogeneous agents. Mercantilism might prioritize the accumulation of aggregate output and the grandeur of state power. Employment, while aligned with state power, is intricately linked to various dimensions and thus determined endogenously by institutions and technologies. We observe a decreasing trend in the employment growth rate, one structural break, and relative insulation from external factors such as geopolitical risk and the strength of the world’s vehicle currency. However, the increase in these two factors has raised the variance of the American inflation rate. Additionally, the strong dollar has contributed to lowering the mean inflation rate.