In today’s Wall Street Journal, Nobel Prize-winning economist Michael Spence has an article, “Why the Old Jobs Aren’t Coming Back,” that reads as both a defense of President Obama’s infamous ATMs comment and a warning about further demand-side stimulus:

Many have expressed shock at the recent U.S. employment data. But 9.1% unemployment shouldn’t be a surprise. To address the jobs challenge, we must stop pretending that this is only a difficult cyclical recovery. The root of the problem is structural.

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A stimulus package that temporarily restores elements of precrisis demand is unlikely to generate the escape velocity needed to get out of the jobs hole. Nontradable job growth can’t mask the declines in the tradable sector any more. The structural problem demands a structural answer.