I frequently describe the catastrophic state of the U.S. labor market as the Long Emergency. Every day, week, month, and year that millions of Americans are unemployed or underemployed creates further long-lasting damage to workers and to the economy overall.
You could also describe the underemployed state of the U.S. economy as the Lost Opportunity. The following chart, says JPMorgan economist James Glassman, “illustrates the ‘lost opportunity’ represented by the absence of employment that has come about from this recession. It translates the decline in the percentage of the population that is not working into GDP—and, therefore, income that is foregone, saving that does not occur, wealth creation that is deferred, and investment in the nation’s capital stock that does not take place—that is foregone.”
Lost opportunities associated with an underemployed economy threaten the economy’s future potential growth rate, because it is virtually impossible to recoup today’s lost work, given the constraints on the country’s productive capacity. In other words, the faster the cyclical damage is repaired, the less negative the implication for the future.