unemployment and real wage growth (inequality)

Yglesias:

Here’s a great chart from the Washington Post illustrating the extent of the current jobs gap:

This also, however, illustrates the most important issue that nobody ever talks about. The Federal Reserve clearly has a policy over the past thirty years of treating upside and downside deviations from full employment asymmetrically. Only once during this period have they allowed unemployment to get “too low” and the deviation was small. By contrast, we’ve had four separate episodes of unemployment being “too high” and in three of those cases the magnitude of the deviation was larger than during the lone “too low” episode. Coincidentally (ha ha) this period corresponded with the only period of sustained real wage growth during the past thirty years.