So while I do expect some discouraged workers to reenter the labor force as the expansion picks up and while they search for a job there could be upward pressure on the unemployment rate, I would not overinterpret the decline in participation as a lack of progress made in labor market conditions or as a problem that must be corrected.
Should this shift in expectations occur, the  4  Joshua Gallin (2004), "The Long-Run Relationship Between House Price and Rents," Finance and Economics Discussion Series 2004-50 (Washington: Board of Governors of the Federal Reserve System, September). 5  Jonathan McCarthy and Richard Peach (2004), "Are Home Prices the Next ‘Bubble’?" Federal Reserve Bank of New York, Economic Policy Review, vol. 10 (December), pp.