[Yellen said that despite] "the fall in the jobless rate to 6.2% from 10% in fall 2009 and average monthly job growth of 230,000 this year, "it speaks to the depths of the damage that, five years after the end of the recession, the labor market has yet to fully recover." [...]
On the one hand, she said, the number of people participating in the labor force is near historic lows. And while much of the decline is due to Baby Boomers retiring, Yellen said even those retiring or going on disability could return to the workforce as the job market improves. That could push up the unemployment rate again -- an argument for keeping interest rates low for a longer period.
Similarly, she said, an unusually large number of Americans are working part-time even though they prefer full-time work, and hiring and the number of workers quitting jobs remains relatively low despite strong growth in the number of job openings. Economists have argued over whether these trends reflect long-term structural changes in the job market or short-term episodes that can be influenced by Fed policy.