A lot of economists have been making the case for a while (I’ve documented some of it on this blog), but like Krugman, I’ve noticed that more and more economists are falling off the structural unemployment bandwagon.
But it’s not just the pundits who are stubbornly resisting this growing consensus, but people involved in actual policy (in and out of government). For example, a lot of workforce investment policy arguments are predicated on the idea that high unemployment is largely structural. I get that many economists (and political progressives) are frustrated by this because they believe it discourages action on more critical areas of economic policy. But it’s worth noting that there are also a lot of good policy goals (like investing more in adult education) that are (in part) supported by the idea that continued high unemployment is mainly a structural problem. It’s a bit of a conundrum.
UPDATE 8/8/13: An additional thought on this. There really isn’t any reason why an argument for offering Americans the opportunity to upgrade their skills should be dependent on the idea that our high unemployment levels are structural. I think the problem only comes when you suggest that improving skills alone will solve the problem of high unemployment/good jobs. But to suggest that there aren’t real adult education or worker training needs, or good policy reasons behind trying to improve people’s education and skill attainment—that it’s all just a scam—is just as facile an argument.