What if rather than mathematical economic formula's and double speak, we just looked at the population of potential workers, by age groups, and employment among them. Then cross reference against the Federal Reserve set Fed Funds rate, Federal Reserve purchased assets, and the debt these policies incentive (I'll focus on federal debt, but the same is true for corporations, individuals).
What is plain? There was a period of economic growth via population growth, a period of growth via increasing participation among females, and now a period of "pseudo growth" via ZIRP, QE, and unrepayable federal debt accrual. And every time the economy hit "full employment" whereupon no further slack or potential employees are available, an economic crisis is declared. What is also obvious is the interplay of ZIRP, QE, and debt to inflate asset prices. All of the rate cuts, QE, and debt are undertaken to purportedly achieve the Fed's mandate of "full employment" but nearly all the real benefits flow to a shrinking cadre of institutional and elderly asset holders. As for the poor, young adults, retirees living on fixed incomes...they are all punished via costs of living rising far faster than incomes thanks to the flow through of the higher asset prices.
25 to 54 year old Population / Employees
25 to 54 year old population (blue line) vs. those employed among them (green line), Fed Funds Rate % (dashed black line), Federal Reserve assets (yellow line), and US federal government marketable Treasury debt (red shaded area).
1- Population growth decelerates into and through 2007...and entirely ceases thereafter.
2- 25 to 54 year old employment growth ends as of 2000, and has been essentially flat-lining for twenty years.
3- Fed funds rate essentially moves inverse the population/employment rate of growth...rising as rate of growth accelerated and falling as growth decelerated...and then turned ZIRP as population/employment ceased growth.
4- From 1981, as population/employment growth decelerated, the Fed Funds Rate was consistently cut to encourage the substitution of debt for the decelerating growth.
But since 2007, as population/employment growth no longer existed, ZIRP plus QE were abused to encourage the explosion of unrepayable debt...and debt that can only be serviced at ZIRP or more likely NIRP.
By simply dividing the employed vs. the population of the age group, we can see clearly where "full employment" lies. As of 1989, full employment has occurred just over 80%...but to achieve the Fed's full employment mandate, it has taken exponentially lower rates and higher debt to fulfill that mandate.
The male vs. female participation (again, population vs. employed among them) explains why the total participation rate rose to 1989 and then has subsequently flatlined since. Female participation nearly doubled from 1960 to the peak of 2000...and since has risen no further. All while male participation continually declines.
15 to 54 year old Population / Employees
Expanding to the wider 15 to 54 year old population & employees among them, still against the same variables. You can see for yourself that population growth ended putting a lid on employment growth...and the substitution of cheaper/greater debt thanks to ZIRP and QE.
But to highlight the impact of the Federal Reserves reaction to no population/employment growth, check the Wilshire 5000 (representing all publicly traded US equity) added to the chart below. The explosion of equities since ZIRP nicely mimics the surge in federal debt and Federal Reserve held assets.
And below you can find the real winners of the Federal Reserves "full employment" mandate...not employees but asset holders (again, see Wilshire 5000 below...but the same can be said for most leveraged financial assets benefitting from ever lower costs of interest service).
To punctuate the full inclusion of females into the workforce, check the 25 to 54 year old male / female participation (yes, duplicate from above) coupled with the now identical participation rates among 15 to 24 year old males and females.
15 to 24 year old population, employees among them, and participation rate. Forty years of essentially zero population growth, declining employment among them, and declining participation begs the question of where economic, consumption, and financial growth will come from?
15 to 24 year old male, female participation. The rise, the 1989 peak of combined male/female participation, and thirty years of declining participation since.
15 to 74 year old Population / Employees
Widening out to the greatest possible "work force", below is the 15 to 74 year old population, employees, and like variables. What should be obvious is that all the population growth and employment growth since 2007 has been among the 55 to 74 year old population. This point is critical as most "money" is created through debt via bank lending. But most new home buyers, car purchasers, etc. are among the 15 to 54 year old population while the 55+ population are more typically neutral and trending to net deleveraging...or the destruction of currency. As the population growth has shifted from net debtors to net "deleveragers", it is into this deflationary, dollar collapse that the Federal Reserve has stepped not just to avoid asset deflation...but offer a massive (yet temporary) asset inflation.
But as the final demographic growth bleeds out among the elderly, the "full employment" participation rate continues to decline...and ever greater ZIRP/NIRP, QE will be unleashed to get politicians to do what they want to do...spend. It will also get corporations to undertake ever more debt as the servicing costs of that debt go to zero (or in the case of NIRP, they are paid to undertake debt).
Looking at the 15 to 74 year old male and female participation, the clear peak in 2000 and declining participation is plain to see.
But it's incomplete to review the US alone, without including the demographic patient zero, Japan.
15 to 64 year old population / Employees
Japan's working age population peaked in 1997 and has declined by 12 million (14%) since while employment among them has fallen by 3.6 million (6%). The BoJ discount rate went to zero as the working age population ceased growth, incenting an explosion in debt/GDP, and since 2012 the Bank of Japan balance sheet has exploded.
Same as above except adding in the Nikkei 225 equity index, which peaked in 1989 but since the explosion in the Bank of Japan balance sheet, is likewise reflating...against all population/employment/economic fundamentals.
Note that the participation ratio (below) of 15 to 64 year old Japanese reached unheard of heights as of 2019.
This is solely due to females entering and staying in the workforce at higher rates than post-war Japan has ever seen.
In short, there was population growth, then female participation growth, and then the growth of ZIRP/NIRP, QE, and debt. The benefits of these different phases have shifted progressively toward the wealthiest. The Fed's full employment mandate (somehow never achieved, according to the Fed) has simply turned into an excuse to encourage unlimited / unrepayable debt...creating untold wealth for a decreasing few at an ever increasing pace.