Bloomberg (04/02/14) Rich Miller; Michelle Jamrisko

Only two of the nine indicators on Federal Reserve Chairman Janet Yellen’s labor-market dashboard—payroll growth and layoffs—have returned to prerecession levels, but joblessness, underemployment, labor force participation, and the other four indicators have yet to return to their 2004-07 averages. This reinforces Yellen’s belief that the central bank still needs to provide “extraordinary support” to the economy for “some time to come.”

Dean Maki, chief U.S. economist for Barclays PLC, says long-term joblessness is likely the most controversial indicator on the dashboard because it may exaggerate the amount of excess manpower in the labor market. Because the long-term unemployed become less active in seeking a job and employers deem them less suitable for hiring, Maki says wages could increase as the labor market improves, regardless of the high long-term unemployment rate. Other economists believe the labor force participation rate could give the Fed an inflated view of the number of potential workers available, because they believe retirements make up a bulk of labor force exits.