Russ Roberts: belief

Transcript context

…Well, think of the labor market as being a very complex matching problem. Right? After the financial crisis of 2008, 2009, unemployment was much higher. It took really a very, very long time for labor markets to come back. That was work over a decade, and that was not 20% unemployment. It was not with any kind of public health crisis going on. Some workers will want to be laid off to collect unemployment insurance or collected it more quickly. Revenues for many businesses will go down. The ties between employers and workers will end up weakened. People will go off and do other things. Reconstituting an enterprise, think of it as putting together a great sports team, like those old San Antonio Spurs teams. That took them quite a few years of drafting and training and playing together as a squad, having the right coach in place. Our economy had been doing a fairly good job of that, but there’s a big reset button being pressed on all those activities. That’s what I mean by the organizational capital going down. In some ways, it will spur efficiency, so firms having to get rid of their less-productive workers. Right? But in the short run, I think it will be fairly dire and our bounce-back could be slower than many people are expecting. Okay. I guess I’m not sure. So much of the economy is going to continue humming along in the background, like we’re doing right now. Here we are producing this podcast. Whether universities can successfully teach classes online, of course, is a struggle, but I think a lot of things are going to stay in place. I’m not sure how important is the organizational capital of a restaurant. They’re going to put a sign out for waiters, and people are going to go work there who used to work there before. I think restaurants-…

Stored transcript either side of the excerpt. The highlighted words are the published quote; the surrounding text is unedited source, never generated.