CSCMP's Supply Chain Quarterly--One of the reasons behind the continued high employment rate, ignored by the media and so-called economic experts, is supply chain synchronization—the practice of using software to match supply with demand. Because companies have deployed software (such as demand sensing programs) that aligns inventory with consumers' purchases, there are fewer spikes in production, and thus there is less demand for workers on the production line.

Supply chain synchronization does not show up in macroeconomic discussions because it's a relatively new phenomenon. In classic economic theory, swings in output are a normal part of the business cycle. As consumption falls, manufacturers find themselves stuck with large quantities of unsold product. They then curb production and lay off workers. After excess inventory has been depleted, manufacturers resume production and hire back workers so they can meet consumer demand. Read more!