Is the U.S. Really at “Full Employment”?

Back in February of 2016 Fortune magazine published an article entitled “The U.S. Economy Is Finally at Full Employment” and then in May CNN-Money published an article entitled The U.S. is ‘basically at full employment’ quoting San Francisco Federal Reserve President John Williams as saying “We’re basically at full employment…that’s very good news.”

“We’re basically at full employment…that’s very good news.” San Francisco Federal Reserve President John Williams. So what is “Full-Employment” and are we really there? At first glance you might think that full employment should equal 0% and with the current unemployment rate hovering around 4.7% we obviously aren’t there. But…

What is Full Employment?

What exactly is full employment and why is it significant to economists?